GAAP
www.nysscpa.org
There is an accounting code established by FASB called the GAAP or “Generally Accepted Accounting Principles.†The assumption is this: if your financial business statement is prepared according to these principles, then you can be rest assured that you can trust or rely on the information of the said financial statement.
There are businesses that deviate from GAAP. In fact, there are a lot of small businesses that do. However, they should inform the evaluator or reader of their financial statement if this is so. It is evident that compliance to standards and principles of FASB is a mixture of regulatory and voluntary behavior. There is currently an effort that is underway to set uniform international accounting standards due to world globalization.