What are 'Generally Accepted Accounting Principles - GAAP'?

Modified on Tue, 19 Jun, 2018 at 3:16 PM

Generally accepted accounting principles (GAAP) are a common set of accounting principles, standards and procedures that companies must follow when they compile their financial statements. GAAP is a combination of authoritative standards (set by policy boards) and the commonly accepted ways of recording and reporting accounting information. GAAP improves the clarity of the communication of financial information.


Source : Investopedia

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