One Global Gaap: Ifrs vs. Us Gaap

In: Business and Management

Submitted By zcao2
Words 2150
Pages 9
One Global GAAP: IFRS vs. US GAAP
Acct 522 Current Topics in Financial Reporting
Zhipeng Cao
CIN: 300443421

Introduction
The most influential accounting reporting criteria today is the International Financial Reporting Standards (IFRS) by and U.S Generally Accepted Accounting Principles (U.S. GAAP). These two different accounting standards have various emphases. In short, IFRS states principles and it leaves the decision-making in everyday questions for accountants, while US GAAP consists of very detailed measures. Under the globalization environment, many companies are operating under a global scale; however, each country has its own accounting standard which makes the translation more difficulty. So the demand for the convergence of the two most important standards comes out. (Accounting Reporting Criteria, 2009, March 23). In this paper, I will put more emphasis on the comparison of the detail differences between International Financial Reporting Standards (IFRS) and U.S Generally Accepted Accounting Principles (U.S. GAAP). I will also pay attention to the convergence of the two accounting principles.

Body 1
In this part, I will mainly discuss the difference between IFRS vs. US GAAP; the table below shows the brief summary of the major differences between IFRS vs. US GAAP. I would like to discuss some of them.

General approach
The most significant difference between IFRS and U.S. GAAP exist in the general approach. IFRS mostly provides the basic accounting principle with limited application guidance; while U.S. GAAP is more tend to rule based standard which contains a list of detailed rules that must be followed when preparing financial statements. In the KPMG, the author stated that the framework of the IFRS is a point of reference in the absence of guidance; Transactions should be accounted for in accordance with their substance, rather…...

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