The common set of standards and procedures by which audited financial statements are prepared is known as:
A) The matching principle.
B) The cash flow identity.
C) Generally Accepted Accounting Principles (GAAP).
D) The Freedom of Information Act (FOIA).
E) The 1993 Omnibus Budget Reconciliation Act.

Question

Quizplus · Accepted Answer

Generally Accepted Accounting Principles (GAAP) are the common set of accounting principles, standards, and procedures that companies use to compile their financial statements. GAAP is a combination of authoritative standards (set by policy boards) and the commonly accepted ways of recording and reporting accounting information.

The Common Set of Standards and Procedures by Which Audited