Question

In one or two paragraphs describe the main differences between the two systems between IFRS & GAAP

Answer 1

Following are some differences between IFRS and GAAP:

International Financial Reporting Standards (IFRS) are international standards developed by the International Accounting Standards Board (IASB) while on the other hand, U.S. Generally Accepted Accounting Principles (GAAP) are only used in the United States.

GAAP tends to be more rules-based, wheras IFRS tends to be more principles-based.

Under IFRS, LIFO method cannot be used, but under GAAP, the companies have the choice between LIFO and FIFO.

In IFRS, the intangible assets are only recognized if they will generate future economic benefit. In this way, the intangible asset can be assessed and given a monetary value. While GAAP, on the other hand, recognises intangible assets at their current fair market value and no additional (future) considerations are made for it.