Which of the following is a CORRECT statement about GAAP and IFRS?
A)IFRS prefers valuing assets at historical cost while GAAP prefers using fair value.
B)IFRS is more "rules-based" than GAAP.
C)The FASB and the IASB are working towards convergence of standards.
D)The SEC will require all companies to use IFRS beginning in 2013.

Question

Quizplus · Accepted Answer

The FASB (which sets GAAP) and the IASB (which sets IFRS) have been working towards convergence of accounting standards for several years, aiming to create more consistency and comparability in financial reporting across countries. While there may be some differences in specific standards, the goal is to ultimately have a set of global accounting standards. A, B, and D are incorrect statements. While there may be some differences in how assets are valued or how rules are applied, these statements are not generally true of either GAAP or IFRS. Additionally, the SEC has not yet made a decision on whether or not to require US companies to use IFRS.

Which of the Following Is a CORRECT Statement About GAAP