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It is critical to have uniform financial statements. The two most widely accepted sets of standards
are IFRS reporting and US GAAP. Here is some information to clarify the differences between
IFRS and GAAP. Moreover, this memo also explains the needs of the accounting standard
implementation in the financial statements and the role of IASB in establishing the standard.
Moreover, the revenue recognition method was a joint project between the FASB and IASB with
nearly perfect convergence. The improved standard made it possible for accounting guidelines to
better reflect the economics of new business models and products. As a result, the
standardization and comparability of revenue recognition across different enterprises and
industries are made easier (Wall Street Prep, n.d.).
IASB Role
INAA (2020) highlights that IASB handles all IFRS technical issues with the following
responsibilities:
Developing and pursuing the IFRS's technical agenda, subject to consultation
requirements with selected trustees and the public.
Preparing and issuing IFRSs and exposure drafts following due process.
Approving and issuing interpretations issued by the IFRS Interpretations Committee.
Since October 2002, the IASB and FASB committed to collaborating to the convergence of US
and international accounting standards. IASB contributes to the improvement of GAAP in the
international accounting standards. The FASB’s operations are overseen by the IASB. FASB
also keeps track of IASB’s projects (INAA, 2020).
References
INAA. (2020, November 13). What’s the Relationship Between IASB and FASB? Retrieved from
Surbhi. (2017, May 19). Difference Between GAAP and IFRS. Retrieved from Key Differences:
https://keydifferences.com/difference-between-gaap-and-ifrs.html
Wall Street Prep. (n.d.). US GAAP vs IFRS. Retrieved from Wall Street Prep:
https://www.wallstreetprep.com/knowledge/us-gaap-vs-ifrs-differences-similarities-
examples-pdf-cheat-sheet/