Running head: GENERAL ACCEPTED ACCOUNTING PRINCIPLES
General Accepted Accounting Principles
Accounting Principles ii
My paper is about the GAAP (General Acceptance of Accounting Principles) which were created by the Accounting Principles Board (APB). The board was created by American Institute of Certified Public Accountants (AICPA) in 1959. APB issued 31 Opinions from 1959 to 1973 and those Opinions created GAAP. I think GAAP is interesting due to how many companies think they can get away with financial dealings but get caught. I also think that GAAP is a system that really needs a good looking at and maybe an overhaul. Some people say the GAAP is dead and should be shelved but I'm interested if they will follow the international GAAP or create a new system.
Accounting Principles 1
GENERAL ACCEPTED ACCOUNTING PRINCIPLES
Prior to the 1930s, general accepted accounting principles (GAAP) were developed through common usage. A practice was considered suitable if it was acceptable to most accountants. As the accounting practices grew and the world of business became more complex many people were not satisfied with the profession's progress in providing useful information. The desire for improvement caused many accountants, managers, and government regulators to want more uniformity in practice. In the 1930s they began to give authority for defining accepted principles to small groups of experienced professional accountants the AICPA (American Institute of Certified Public Accountants). (K.D. Larson, 1997). The AICPA in 1959 created the Accounting Principles Board (APB) which mission was to develop an overall conceptual framework. The APB lacked productivity and failed to respond promptly. Realizing the needs to reform the APB, leaders in accounting profession appointed a study group on (Establishment of Accounting Principles). This group determined that the APB must be dissolved and a new...