2

Generally Accepted Accounting Principles and Accounting Standards

CHAPTER OBJECTIVES

This chapter will help the readers to:

  • Understand the nature and purpose of GAAP.
  • Visualize the impact of important accounting principles on financial reporting.
  • Develop familiarity with key accounting principles.
  • Apply accounting principles to accounting events.
  • Appreciate requirements of Ind AS 8 relating to accounting policies.
  • Understand the role of the Institute of Chartered Accountants of India (ICAI) in setting of accounting standards.
  • Appreciate the need for having uniform global accounting standards.
2.1 NATURE OF GENERALLY ACCEPTED ACCOUNTING PRINCIPLES

Accounting principles or GAAP are general rules guiding recording of accounting transactions. ...

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