According to the text GAAP and IFRS share a similar conceptual framework.This framework is designed to provide useful information to the providers of financing.As IASB and FASB have been working for over a decade to unite IFRS and GAAP, there is more similarities than differences (Hoyle).

One main difference between generally accepted accounting principles (GAAP) and international financial reporting standards (IFRS), fully explain the difference.

Classification, presentation and disclosure differences relate to the manner in which items are classified or presented on the financial statements or disclosed in the notes to the financial statements (Hoyle).One of the differences that is found in the presentation is IFRS has a single standard IAS1, which is presentation of financial statements that governs the presentation of financial statements.GAAP has no equivalent to IAS 1.

There are five issues that IAS 1 is providing guidance for:

1. Purpose of financial statements
2. Overriding principle of fair presentation
3. Basic principles and assumptions
4. Components of financial statements
5. Structure and content of financial statements

Discuss how that difference impacts financial reporting.

According to IAS 1, the requirement is for an entity to classify assets and liabilities as current and noncurrent unless presentation of the liquidity provides more reliable information.The income statement can be presented using either a cost of sales format or a nature of expense format.IFRS doesn't allow extraordinary items on an income statement but GAAP does allow that as a line item.If an extraordinary item is a negative, then it's listed as extraordinary on the income statement.Depending on how these items are reported it will change the net income results.

Discuss which standard you think is more appropriate to apply to financial accounting and why?

I think GAAP is the way to apply to financial accounting.The US law requires businesses that release financial statements to follow the GAAP guidelines.These guidelines cover 10 key concepts.Those concepts are:

1. Principle of regularity
2. Principle of consistency
3. Principle of sincerity
4. Principle of permanence of methods
5. Principle of non-compensation
6. Principle of prudence
7. Principle of continuity
8. Principle of periodicity
9. Principle of materiality
10. Principle of utmost good faith (accounting.com)

Required:

Discuss whether you agree or disagree with the impact they discussed and why