6Value Stream Income Statements
GAAP = GAAH!
This is a typical reaction of non-financial managers in companies when they are given financial reports based on Generally Accepted Accounting Principles (GAAP), and they are expected to explain the financial results. This reaction occurs for three primary reasons:
- Accounting principles exist to create common standards for external financial reporting, making it easier for readers of financial statements to understand company performance and make rational decisions about investments, loans or comparing companies’ financial performance.
- The reporting requirements of GAAP can mask actual financial performance because of specific adjustments accounting must make to maintain ...
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