What is the prudence concept in accounting? Under the prudence concept‚ you should not overestimate the amount of revenues that you record‚ nor underestimate the expenses. You should also be conservative in recording the amount of assets‚ and not underestimate liabilities. Another way of looking at prudence is to only record a revenue transaction or an asset when it is certain‚ and to record an expense transaction or liability when it is probable. Another aspect of the prudence concept is that you
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Date: November 2nd 2011 Subject: Japanese accounting practices JAPANSE GAAP Japan in the year 2010 had a GDP of 4.31 trillion dollars making them the 4th largest in the world 1. With this being said it is important that other countries doing business in the nation have a strong knowledge of their accounting practices. Japanese accounting practices have been going through some major changes over the past 10 years. In 2001 Financial Accounting Standards Foundation (FASF) was formed as well
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| MEXICAN GAAP (MEXICAN FRS) | US GAAP | Inflation | Effects of inflation should be recorded on the financial statement.Included in the results of operations is a gain or loss from monetary position that represents the inflation gain or loss from maintaining net monetary liabilities or assets‚ respectively. | In the U.S. GAAP no gain or loss on monetary position is recognized in the financial statements. | Deferred Taxes | Mexican GAAP recognizesDeferred tax effects for all transactions that
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1. Explain 5 major differences between IAS/IFRS and US GAAP. Research and Development With US GAAP Development costs are expensed as incurred unless addressed by guidance. They are related to computer software developed for external use is capitalized once technological feasibility is established in accordance with specific critical area. In the case of software developed for internal use‚ only those costs incurred during this application development stage may be capitalized. With IFRS (IAS
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Comparing IFRS to GAAP Craig Ronquillo ACC/291 8 December‚ 2014 Joseph Bailey Comparing IFRS to GAAP I will be comparing IFRS to GAAP‚ and be discussing many ways these two get along with each other and see what they do differently as well‚ they both have their ways of doing things which are easier but sometime even harder. IFRS 8-1: What are some steps taken by both the FASB and IASB to move to fair value measurement for financial instruments? In what ways have some of the approaches differed
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working towards converging it own accounting standard‚ US GAAPs (United States Generally Accepted Accounting Principles) with IFRSs (International Financial Reporting Standards). This report is about the evaluation of the convergence project to form a global standardized financial statement. IFRS is a set of international accounting standards stated how particular types of transactions should be reported in financial statements. However‚ U.S GAAP is a common set of accounting principles‚ standards and
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OVERVIEW Accounting is the language of business. As such‚ accountants collect and communicate economic information about business enterprises or other entities to a wide variety of persons. To be useful‚ financial statements must be clearly understandable and comparable so that users may compare the performance of one business with the performance of the same business for a prior period or with the performance of another similar business. Therefore‚ all general purpose financial statements should
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Charlotte Stevens 02/13/13 GAAP Cases A) The amount shouldn’t be included on the balance sheet of the business because there isn’t even half a chance that the debt will be paid. The generally accepted accounting principle that affects this situation is the going concern concept because there is a good chance that the debt won’t be paid. B) The amount that should be recognized under the accounts
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US GAAP vs. PRC GAAP 1. Overview of US GAAP Components of US GAAP - Financial Accounting Standards Board / Financial Accounting Standards - Accounting Research Bulletin - Accounting Principles Board - Emerging Issues Task Force - Statements of Position from AICPA (American Institute of Certified Public Accountants) - SEC (Securities and Exchange Commission) rules Hierarchy of pronouncements under US GAAP - FASB‚ APB & ARB - FASB Technical Bulletin‚ AICPA Statements
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GAAP v. non-GAAP: Impacts on Financial Statements A non-GAAP financial measure is a numerical measure of past or future financial performance‚ financial position or cash flows that includes amounts that are excluded from the most directly comparable GAAP measure or excludes amounts that are included in the most directly comparable GAAP measure. Some common examples of non-GAAP earnings measures are cash earnings‚ operating earnings‚ EBITDA and FFO. The non-GAAP numbers impact revenue numbers without
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