US GAAP or simply GAAP are accounting rules used to prepare, present, and report financial statements for a wide variety of entities, including publicly-traded and privately-held companies, non-profit organizations, and governments. The Financial Accounting Standards Board (FASB) is a private, not-for-profit organization whose primary purpose is to develop GAAP within the United States in the public's interest. The Securities and Exchange Commission (SEC) designated the FASB as the organization responsible for setting accounting standards for public companies in the U.S.
On the other hand, the second set of accounting standard is IFRS (International Financial Reporting Standards), which is issued by the International Accounting Standards Board (IASB), based in London. Nearly 100 countries use it or coordinate their financial instruments. These countries or groups of countries include the European Union, Australia, and South Africa. While some countries require all companies to adhere to IFRS, others merely allow it, or try to coordinate its own country’s standards to be similar. The IASB is working toward this goal in a partnership with some of the most influential accounting standard-setters across the globe.
The globalization of business and finance has led more than 12,000 companies in more than 100 countries to adopt IFRS. In the United States, the Securities and Exchange Commission (SEC) has been taking steps to set a date to allow U.S. public companies to use IFRS, and perhaps make its adoption mandatory. In fact, on November 14, 2008, the SEC released for public comment a proposed roadmap with a timeline and key milestones for adopting IFRS, beginning in 2014.
IFRS website states that the convergence between IFRS and US GAAP brings some benefits. Growing interest in the global acceptance of a... [continues]
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