Scribd Logo
Upload

Welcome to Scribd!

  • Difference Between Indian Gaap and Us Gaap

    Uploaded by

    deepakarora201188
    52 views2 pages
    The major differences between Indian GAAP and US GAAP are: 1) Indian GAAP follows the principle of conservatism which anticipates no profits and provides for all possible losses, while US GAAP does not consider conservatism if it leads to understatements. 2) Indian GAAP has a specified format for financial statements under Schedule VI, while US GAAP only requires compliance with disclosure requirements. 3) Cash flow statements are mandatory for certain large Indian companies but required for all US companies regardless of size or listing status. 4) Depreciation rates are prescribed under Indian GAAP while US GAAP uses estimated useful life.

    Original Description:

    Copyright

    © Attribution Non-Commercial (BY-NC)

    Available Formats

    DOC, PDF, TXT or read online from Scribd

    Did you find this document useful?

    Is this content inappropriate?

    Report this Document
    The major differences between Indian GAAP and US GAAP are: 1) Indian GAAP follows the principle of conservatism which anticipates no profits and provides for all possible losses, while US GAAP does not consider conservatism if it leads to understatements. 2) Indian GAAP has a specified format for financial statements under Schedule VI, while US GAAP only requires compliance with disclosure requirements. 3) Cash flow statements are mandatory for certain large Indian companies but required for all US companies regardless of size or listing status. 4) Depreciation rates are prescribed under Indian GAAP while US GAAP uses estimated useful life.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as DOC, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    52 views2 pages

    Difference Between Indian Gaap and Us Gaap

    Uploaded by

    deepakarora201188
    The major differences between Indian GAAP and US GAAP are: 1) Indian GAAP follows the principle of conservatism which anticipates no profits and provides for all possible losses, while US GAAP does not consider conservatism if it leads to understatements. 2) Indian GAAP has a specified format for financial statements under Schedule VI, while US GAAP only requires compliance with disclosure requirements. 3) Cash flow statements are mandatory for certain large Indian companies but required for all US companies regardless of size or listing status. 4) Depreciation rates are prescribed under Indian GAAP while US GAAP uses estimated useful life.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as DOC, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    of 2

    Difference between Indian gaap and us

    gaap?
    [Improve]

    MAJOR DIFFERENCES:

    1. Underlying assumptions: Under Indian GAAP, Financial statements are prepared in


    accordance with the principle of conservatism which basically means "Anticipate no
    profits and provide for all possible losses". Under US GAAP conservatism is not
    considered, if it leads to deliberate and consistent understatements---revenue recognized
    when earned or when it is realized or realizable.

    2. Format/ Presentation of financial statements: Under Indian GAAP, financial


    statements are prepared in accordance with the presentation requirements of Schedule VI
    to the Companies Act, 1956. On the other hand , financial statements prepared as per US
    GAAP are not required to be prepared under any specific format as long as they comply
    with the disclosure requirements of US GAAP.

    3. Cash flow statement: Under Indian GAAP (AS 3) , inclusion of Cash Flow statement
    in financial statements is mandatory only for companies whose share are listed on
    recognized stock exchanges and Certain enterprises whose turnover for the accounting
    period exceeds Rs. 50 crore. Thus , unlisted companies escape the burden of providing
    cash flow statements as part of their financial statements. On the other hand, US GAAP
    (SFAS 95) mandates furnishing of cash flow statements for 3 years - current year and 2
    immediate preceding years irrespective of whether the company is listed or not .

    4. Depreciation: Under the Indian GAAP, depreciation is provided based on rates


    prescribed by the Companies Act, 1956. US GAAP , depreciation has to be provided over
    the estimated useful life of the asset,

    5. Long term Debts: Under US GAAP , the current portion of long term debt is
    classified as current liability, whereas under the Indian GAAP, there is no such
    requirement and hence the interest accrued on such long term debt in not taken as current
    liability.

    6. Consolidation of subsidiary accounts: Under the Indian GAAP, consolidation of


    accounts of subsidiary companies is not mandatory. Under US GAAP (SFAS
    94),Consolidation of results of Subsidiary Companies is mandatory.

    7. Investments: Under Indian GAAP (AS 13), Investments are classified as current and
    long term. Investments are required to be segregated in 3 categories i.e. held to Maturity
    Security ( Primarily Debt Security) , Trading Security and Available for sales Security
    and should be further segregated as Current or Non current on Individual basis.

    You might also like