GAAP Accounting Rules

What does GAAP Stand for?

GAAP in accounting is an acronym for Generally Accepted Accounting Principles. GAAP accounting rules are used to regulate accounting and financial reporting in a particular country or territory.

How are GAAP Accounting Rules Established?

GAAP accounting rules are established from many sources but are mainly derived from the following:

  • Accounting Standards
  • Company legislation
  • Statutory requirements
  • Stock exchange requirements

The purpose of Generally Accepted Accounting Principles is to ensure that financial statements issued outside a business are compiled from the underlying accounting information in a consistent and understandable way. This consistency allows third parties such as investors, tax authorities, and bank mangers, to analyze and understand the financial statements and allows comparisons to be made with other businesses.

Our post on Accounting Principles provides additional information on the uses of Generally Accepted Accounting Principles accounting rules.

For further information see the Wikipedia definition.

Learn a new Bookkeeping Term

Random bookkeeping terms for you to discover.

Link to this Definition

Click in the box to copy and paste this definition link to your site.

Return to the Glossary

GAAP Accounting Rules August 31st, 2016Team

You May Also Like

Related pages

future value annuity equationdouble entry bookkepingannuities formulastimes interest earned ratio interpretationwhat is journal voucher in accountingdefine double entry bookkeepingpresent value of an anuitymultiple-step income statementsannuity functionhow to calculate cost of goods available for salefv excel functioninventory reserve journal entryhow to calculate the payback periodfixed overhead costgearing financeformula for pvareducing balance method depreciation rate formulaannuities due formulaaverage account receivablespayback period exampleaccounting template for excelvoucher payment sampleaccounting closing entriesvouchered invoicesdiscount formula for excelformula to calculate pmtstraight line depreciation is a typical example of ahow to record dividends payablefinancial statement horizontal analysismaterial requisition form templateaccrued expenses examplestreatment of suspense account in balance sheetfactoring receivables examplestraight amortizationlessor accounting examplesample of general ledger sheetdays in receivable formulaaccounts spreadsheet templateconstant growth annuitybank reconciliation statements examplessoftware amortisationdouble declining balance tablepercentage of completion method journal entriescheque payment receipt format in wordcalculate manufacturing overheadexcel ratio formulaannuity present value formulahow to calculate debtorsdifference between imprest and petty cashbasic accounting quiz and answerscash disbursement journalin a bank reconciliation a nsf check isjournal entry for dividend incomecontra account journal entrytime sheet sampledebit and credit in balance sheetstraight line amortization calculatorlifo examplewhat does contra asset meanaverage payment period ratio formulafree petty cash log templatehow to calculate inventory turnover periodallowance for uncollectible accounts journal entrywithholding tax entryaccount receivable turnover days formulacompute ending inventoryhow to calculate a stock splitaccounting tutorialsadvantages of cash bookdepreciation accumulated depreciation journal entrycontribution margin in dollars formulaoperating lease accounting entriespartnership accounting tutorialcogs definition accountingcash float sheetpresent value of an annuity due of 1 tabletutorial for accounting for beginners