Differences between GAAP and IFRS.
GAAP simply stands for generally accepted accounting principles while IFRS stands for international financial reporting standards.
The following principles of accounting will the managers are in a position to deal with the account easily and the reports to be easily understood by the users of this report like shareholders, creditors, competitors as well as management itself. Periodicity concept will enable the management to prepare income statement at the end of trading period with is normally 12 months. This will enable the management to compare the profits from different trading periods. The going concern concept will enable the management to assume that the organization is going to continue its operations. This will enable the management to set aside the funds to cater for future operations.
In IFRS IAS 1 require the organizations to prepare cash flow after each trading period. This will enable the management to compute its gross profit, profit and to calculate the amount to be distributed to shareholders.IFRS helps to reduce or eliminate confusing variations in the methods used to prepare the accounts. They will also make the organization to disclose the accounting policies used in the preparations of the accounts.
http://www.accountingfoundation.org/gaap
Price, Sharon. Predictive Ability for US GAAP and IFRS. Diss. ANDERSON UNIVERSITY, 2014.
Giloz-Ran, Estery, Ilanit Gavious, and Baruch Lev. “The Positive Externalities of IFRS: Enhanced R&D Disclosure.” (2014).
Beck, Allison K., et al. “Firm Equity Investment Decisions and US GAAP and IFRS Consolidation Control Guidelines: An Empirical Analysis.” Journal of International Accounting Research (2017).