U.S. GAAP vs IFRS Each accounting standard has a different approach to setting standards for reporting on financial statements. The U.S. General Accepted Accounting Principles (GAAP) has a very controlled view on accounting standards. Each financial topic has a set of accompanying rules and guidelines to give users direction for any situation. The U.S. GAAP has become a complex, long book of financial regulations that is enforced by the Federal Accounting Standards Board (FASB). The International Financial Reporting Standards (IFRS) are a set of guidelines for users that gives them a foundation to base their financial reporting judgments. The guidelines give directions on general concepts but allows the users to make decisions on individual …show more content…
GAAP makes changes through the FASB who first issues exposure drafts. The exposure drafts are an outline of proposed changes to a very precise area of GAAP. People can submit suggestions and opinions these proposed changes before they become official. The exposure draft concerning Topic 958, Not-For-Profit Entities, is laying the groundwork for the update of not-for-profit accounting standards. This FASB issued draft is addressing the uncertainty in dealing with revenue recognition, classifying contributions, and interpreting donor restrictions. The draft is very detail-oriented about the different possibilities that could occur in not-for-profit financial reporting. If a subject is not covered in Topic 958, there is a reference to find the information in another given topic. The draft is very structured and is restricted to the limited …show more content…
(2015). Accounting Errors in Nonprofit Organizations. Accounting Horizons, 29(2), 341-361. doi: 10.2308/acch-51017 Ryan, C., Mack, J., Tooley, S. & Irvine, H. (2014). Do Not-For-Profits Need their own Conceptual Framework? Financial Accountability & Management in Governments, Public Services, and Charities, 30(4), 383-402. doi: 10.1111/faam.12044 Scott, D. (2015). Forward. In Davies, N. & Martin, R., Companion Guide for Not-For-Profits to the International Financial Reporting Standard for Small and Medium-sized Entities (IFRS for SMES), (4-5). Association of Chartered Certified Accountants (original work published 2015). Turpen, R. (2017, May). Not-for-Profit Entities and the New Revenue Recognition Standard. CPA Journal. Retrieved from http://www.cpajournal.com Tysiac, K. (2016, August 19). FASB modifies not-for-profit accounting rules. Journal of Accountancy. Retrieved from http://www.journalofaccountancy.com Tysiac, K. (2017, August 4). FASB proposes changes to grant and contribution accounting. Journal of Accountancy. Retrieved from