accounting standard
Sign in to saveAlso known as accounting principles, GAAP, generally accepted accounting principles
the specific accounting discipline followed (IFRS, US GAAP, Chinese AS, France GAAP, Germany GAAP, Russian GAAP, UK GAAP, etc.)
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- technical standard
- Part of
- accounting
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- Category:Accounting standards
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Encyclopedic overview
Publicly traded companies typically are subject to rigorous standards. Small and medium businesses often follow more simplified standards, plus any specific disclosures required by their specific lenders and shareholders. Some firms operate on the cash method of accounting which can often be simple and straightforward. Larger firms most often operate on an accrual basis. Accrual basis is one of the fundamental accounting assumptions, and if it is followed by the company while preparing the financial statements, then no further disclosure is required. Accounting standards prescribe in considerable detail what accruals must be made, how the financial statements are to be presented, and what additional disclosures are required. The term generally accepted accounting principles (GAAP) was popularized in the late 1930s.
Some important elements that accounting standards cover include identifying the exact entity which is reporting, discussing any "going concern" questions, specifying monetary units, and reporting time frames.
Excerpted from Wikipedia’s “accounting standard” article, available under the CC BY-SA 4.0 licence.