GAAP and IFRS

Please read the post below and write a positive comment. (comment examples are in the bottom) GAAP and IFRS have more similarities than differences. Both have strengths that companys recognize and there are distinguished differences that some companys might prefer. The biggest differences that companys might recognize are the presentation and the disclosures. While GAAP leaves little room for personal judgement, IFRS gives more authority to the companies. Looking at the financial statements for different companies in Mexico, you can tell which companies adapted more GAAP rules than those who use IFRS. Gropo Televisa, a network company has their financials in according to IFRS. When looking at the statement of cash flow, the cash flow is listed in the direct method (IFRS allows using both methods). The cash flow is reconciled from net income to operating cash flow. The view and what the financials disclose also are a big difference especially when you are not used to reading IFRS financials. In order for analyst to properly compare companies that are not in GAAP they have to understand the differences they are looking for. Using different rations can help analyst compare companies better than just comparing different financials however, for best comparability financials should be read in either GAAP or IFRS. (Example) Good post. I agree that it is incredibly important to realize the differences in cash flow reporting. (example2) I agree that the statement of cash flow is important to assess from a differences perspective, the balance sheet also has differences but they are by far less, than comparatively the cash flow statement.

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