What is the main reason that it is necessary for public companies to follow the rules...

What is the main reason that it is necessary for public companies to follow the rules and format set out in the Generally Accepted Accounting Principles (GAAP) when creating financial statements?

Expert Solution

The most important reason that most companies are required to follow rules and format set out in the US GAAP is it makes it easier to compare the financial statement and the performance of the company with other firms in the industry or outside it. In most countries across the world there are set rules and format in which the financial statement has to be presented every period be it quarterly or semi-annually or annually because it is then easy to compare its financial performance with other firms in the industry. The set rules and standards have to be followed by every public company.

jeff jeffy answered 2 years ago

International Financial Reporting Standards (IFRS) do not allow companies that follow the accounting rules to use...

International Financial Reporting Standards (IFRS) do not allow companies that follow the accounting rules to use LIFO for financial reporting. Your post should explain two things: 1. Why do you think LIFO is not allowed by IFRS but is allowed by GAAP in the United States? 2. Another area of accounting rules where there is a significant difference between US GAAP and International Financial Reporting Standards. Please include the reference where you found information to form your opinion in 1...

What are “the two main rules” for business and organizational writing?

Essay about : rules are necessary for succes

What is the solid electrolyte called in a fuel cell? What is the main reason that...

What is the solid electrolyte called in a fuel cell? What is the main reason that fuel cells do not produce the theoretical voltage of 1.23 volts?

What is the main reason for using covariance analysis in a randomized study?

What are the three main duties of directors and why are they necessary?

What is the main reason why it is hard to measure the ClickThrough Rate (CTR)?

After identifying 2 competing public companies you will do research to obtain the necessary financial statements...

After identifying 2 competing public companies you will do research to obtain the necessary financial statements (2 years) on each firm. Most important is your “personal assessment” of what you found / learned about the two companies. Required preparation and analysis: A. Common Size Statements and Analysis - Vertical and Horizontal Analysis B. Ratio Analysis and Analysis - Commentary based upon Liquidity, Solvency, Efficiency, Profitability, Market, Financial Leverage, and Coverage. C. A DuPont analysis that compares the 3 DuPont...

The reason why government must provide public goods is due to what?

Explain the reason why friction is necessary for the creation of lift.

Question