Overview the difference of IFRS and GAAP IFRS is the global accounting and financial reporting standard and created to find the common accounting and financial reporting internationally. However, GAAP is an accounting standard that are exclusively used in the United States. There are some countries are folowing the GAAP. However, Since more and more adopting IFRS, as the International Corporation, covering from GAAP to IFRS is very important. 10 minutes of IFRS from PricewaterhouseCoopers will give in oveview of what IFRS is and what it is different from GAAP.
Accounting Differences in IFRS Vs GAAP
The main difference between IFRS and Vs GAAP is that IFRS is evalutating its Asset and liability as well as its Equity as the Fair Market Value. Howver, GAAP is still holding on to its Historical Cost principle. IFRS and GAAP might have the same basic principle but each has differerent ways of accounting for something like inventory, Account Receivable to Lease Aggrement, and Goodwill. Even GAAP are moving toward to Fair Market Value to deal with some issues with historical cost principle. To understand and see the differences between IFRS and GAAP on each accounting principle, the chart is creating to compare the IFRS and GAAP rules. Click here to see the chart
Why is Important to Understand IFRS vs GAAP?
IFRS is very different from GAAP in almost every aspect of accoutning rule and principle. Understanding the difference between IFRS and GAAP is important to makre the transition in the future. Within about 5 or 6 years, the transition will be made and the understand such diffrerences would contribute to many great opporunity in the near future.
To see what the opportunity IFRS will be below are the some links which will lead to understanding the great opportunity for the near future.
Ernst & Young
To understand more about the major difference of IFRS vs GAAP, Check out the link below:
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Group Project Business 188 |
IFRS vs GAAP |