WHAT ARE GENERALLY ACCEPTED ACCOUNTING PRINCIPLES ?

GAAP

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mindcrime828 May 1, 2010 at 2:09 pm

Generally Accepted Accounting Principles (GAAP) is the standard framework of guidelines for financial accounting. It includes the standards, conventions, and rules accountants follow in recording and summarizing transactions, and in the preparation of financial statements.

GAAP for nongovernmental entities include those conventions, rules, and procedures that the Financial Accounting Standards Board (FASB) and its predecessors, the Accounting Principles Board and the Committee on Accounting Procedure (two now-defunct AICPA committees), have deemed preferable in their official pronouncements. In the abscence of officially established accounting principles, GAAP are deemed to include such sources of established principles as FASB Technical Bulletins, AICPA Audit and Accounting Guides, and AICPA Statements of Position. If no sources of established principles exist, other accounting literatur, such as Statements of Financial Accounting Concepts, may furnish guidance.

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