GAAP is mainly used for accounting and financial reporting standards for companies and non-profit organizations in the US. GAAP is usually the set of rules that are issued by a financial accounting standard board. Generally accepted accounting principles are mainly used to analyze company financial status.
10 Generally Accepted Accounting Principles
The 10 best GAAP Accounting Principles are-
1. Principle of Consistency
2. Principle of Regularity
3. Principle of Sincerity
4. Principle of Permanence of Methods
5. Principle of Non-Compensation
6. Principle of Prudence
7. Principle of Continuity
8. Principle of Periodicity
9. Principle of Materiality
10. Principle of Utmost Good Faith
Advantages of GAAP Accounting Standards
Major advantages of GAAP Accounting Standards are-
1. It helps to check and maintain the consistency & integrity of the business.
2. Help to safeguards the rights of stakeholders
3. GAAP Standards help and maintain the trust and interest of everyone
4- GAAP Accounting Standards also help by providing the facility to compare the auditing of financial statements.
5- Help by identifying the weaker section of business that needs improvement.
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