What Are the Importance of GAAP (Generally Accepted Accounting Principles)

1. Due to the implementation of GAAP, the true & fair representation of Financial Statements are reliably presented and reported to the Users of Financial Statements as the organization follows those Universally Accounting Standards that are understandable and provide a meaningful information of a business. For Example, Matching Concept helps in meeting Revenues with Expenses in order to provide true information about the real revenue earned by utilizing relevant expenses incurred in earning that revenue.

 

2. As Generally Accepted Accounting Principles (GAAP) are universally accepted i.e., these are globally accepted in all over the world, so uniform accounting information is obtained.