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Accounting & Tax vocabulary · Reporting Standards

GAAP

Meaning in accounting & tax, with examples

/ɡæp/abbreviationCommon term

In accounting & tax, GAAP means: Generally Accepted Accounting Principles: the set of accounting rules used in a particular country, most often meaning US GAAP, set by the FASB.

In Turkish: genel kabul görmüş muhasebe ilkeleri, yerel muhasebe kuralları

How it is used

Pronounced like the word 'gap'. Groups talk about local GAAP (the rules of each subsidiary's country) and adjustments from local GAAP to IFRS or US GAAP. Non-GAAP measures are figures calculated outside these rules.

Example sentences

  1. Our US parent reports under US GAAP, so we send them adjusted figures every quarter.

  2. Most of the difference between local GAAP and IFRS comes from leases.

Common collocations

  • US GAAP
  • local GAAP
  • non-GAAP measures
  • GAAP adjustments
  • IFRSInternational Financial Reporting Standards: the global accounting rules issued by the IASB and required for listed companies in more than 140 jurisdictions.
  • fair valueThe price that would be received to sell an asset, or paid to transfer a liability, in a normal transaction between market participants on a given date.
  • consolidated financial statementsFinancial statements that combine a parent company and all the subsidiaries it controls as if they were one single business.
  • EBITDAEarnings before interest, taxes, depreciation and amortization: a measure of operating profit that leaves out financing costs, tax and non-cash asset costs.

More terms: Reporting Standards

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This page explains English vocabulary for learners. It is not financial advice.