Question

What are the differences between Generally Accepted Accounting Principles (GAAP) and IFRS concerning valuation of accounts receivables?

Answer 1

GAAP (concerning valuation of accounts receivables)	IFRS (concerning valuation of accounts receivables)
1. Generally accepted accounting principles refer to a common set of accepted accounting principles, standards, and procedures that companies and their accountants must follow when they compile their financial statements.	1.International Financial Reporting Standards (IFRS) are a set of international accounting standards, which state how particular types of transactions and other events should be reported in financial statements.
2.If a company distributes its financial statements outside of the company, GAAP must be followed. If a corporation's stock is publicly traded, financial statements must also adhere to rules established by the U.S. Securities and Exchange Commission.	2.The point of IFRS is to maintain stability and transparency throughout the financial world. IFRS enables the ability to see exactly what has been happening with a company and allows businesses and individual investors to make educated financial decisions.
3.GAAP is rules-based system.	3. IFRS principles-based system.
4. GAAP rules allow for LIFO.	4. IFRS rules ban the use of last-in, first-out (LIFO) inventory accounting methods
5.GAAP is specific to the United States and has been adopted by the SEC.	5.IFRS is a global set of standards that has become increasingly adopted as the worldwide standard.
6.Development costs: Under GAAP, these costs are considered expenses.	6.Development costs: Under IFRS, the costs are capitalized and amortized over multiple periods.
7.GAAP specifies the write-down amount of an inventory or fixed asset can't be reversed if the market value of the asset subsequently increases.	7.On the other hand, the IFRS allows the write-down to be reversed.