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Examine the financial statements of competitors in the country. Are there any differences in terms of...

Examine the financial statements of competitors in the country. Are there any differences in terms of language, currency, or the type of statements (income statement, balance sheet, financial statement format, extent of footnote disclosures, and the underlying GAAP [generally accepted accounting principles]) between your organization's reports in the United States and the reports required by law in the country? Review National Adoption of International Accounting Standards: An Institutional Perspective.

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Answer #1

There are many difference in the financial statements that are prepared based on GAAP and based on IFRS.

Coverge

It can be seen that the GAAP is only exclusively for the USA but the IFRS is applied in more than 110 countries

Principles Vs rules

GAAP accounting is rule based but IFRS accounting is situation based and concentrate more on the situations.

Inventory method

In GAAP financial statement it can be seen that LIFO method is used but in case of IFRS this method is not allowed.

Development cost

Under IFRS development cost can be capitalized but in GAAP such costs cannot be capitalized and must be expensed off.

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