Accounting Standards (GAAP)

Accounting Standards, such as Generally Accepted Accounting Principles (GAAP), are a set of rules and guidelines that companies follow to prepare financial statements. They ensure consistency, transparency, and comparability of financial information across businesses and periods. By adhering to GAAP, companies present their financial health in a clear, accurate manner, making it easier for investors, regulators, and other stakeholders to evaluate and trust their reports. These standards cover how to recognize revenue, value assets and liabilities, and disclose financial information, promoting reliable and uniform financial reporting across industries.