US GAAP vs. IFRS Accounting Standards

US GAAP vs. IFRS Accounting Standards
Student Name
Institution
ACC 5301 Management Applications of Accounting
Instructor
Date
Abstract
The different accounting standards determine an organization's operations. The US GAAP and the IFRS are two common accounting standards that shape business operations. The GlaxoSmithKline serves as a perfect organization operating in the US and the UK and whose activities are governed by the two standards. Notably, the IFRS tends to be more comprehensive in terms of the information it presents compared to the GAAP. As such standard demands the fulfillment of more requirements, the organization is governed and may spend more under the IFRS to ensure compliance with such requirements.
US GAAP vs. IFRS Accounting Standards
Every country has specific features or tendencies that make it unique and different from the rest of the world. Even when it comes to law and consumer standards, there are international standards that guide the conduct of firms at the international level and local standards for each state regarding how companies should conduct their businesses in their territories. In the accounting sphere, GAAP accounting differs from international accounting in certain ways. For example, whereas the last-in, first-out (LIFO) inventory-costing technique is banned at the international level, companies that rely on GAAP are allowed to use it. A comparison of the IFRS vs. GAAP accounting standards reveals how the varying methods affect business operations and product costs. The impact of the differences in the regulations explains the performance variation between companies in the United States and those in other countries that rely on the international system, such as the UK.
Part 1 Financial Statement Comparison
A comparison of the financial statements of GlaxoSmithKline Company prepared in accordance with the GAAP, and that prepared using IFRS shows some major differences in compliance requirements that point to a different performance of the organization in the two settings. An assessment of the financial statements prepared following the two standards shows that IFRS standard companies' financial statements have relatively more disclosures than GAAP standards companies (GlaxoSmithKline, 2021). More disclosures can be attributed to the IFRS requirement for more detailed disclosure.
Thus, companies that rely on IFRS provide more detailed information concerning corporate governance. Reports such as the Government Report, a report on Corporate Responsibility, and Nominations Committee Report are some of the company statements that are more detailed under the IFRS market compared to the GAAP markets. The US GAAP requires the presentation of some key details, such as the current assets in terms of trade and other receivables, cash at the bank, total current assets, short-term borrowings, and capital and reserves (The Investopedia Team, 2021). On the contrary, the reports based on the IFRS appears more comprehensively as it highlights more pertinent details including the total comprehensive income of the year, various interests forms, the equities, and many other details. As a manager, my choice of statement would be the one prepared using the IFRS because it captures more...