Generally Accepted Accounting Principles

The common set of standards that are generally accepted and universally practiced is called generally accepted accounting principles (GAAP). These standards indicate how to report economic events. In United States Financial Accounting Standards Board (FASB) is primary accounting standard-setting body. The Securities and Exchange Commission (SEC) is the agency of the U.S. government that oversees U.S. financial markets and accounting standard- setting bodies. The SEC relies on the FASB to develop accounting standards, which public companies must follow. Many countries outside of the United States have adopted the accounting standards issued by the International Accounting Standards Board (IASB), these standards are called International Financial Reporting Standards (IFRS).