Characteristics of generally accepted accounting principles include all of the following except

1. practice has become universally accepted over time.

2. standards are considered useful by the profession.

3. each principle is approved by the SEC.

4. authoritative accounting that the rule-making body has established as a principle of reporting.

Question

Isaias

Business

8 March, 04:26

Characteristics of generally accepted accounting principles include all of the following except

1. practice has become universally accepted over time.

2. standards are considered useful by the profession.

3. each principle is approved by the SEC.

4. authoritative accounting that the rule-making body has established as a principle of reporting.

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Answers (1)

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Tommy Harrington · Answer 1

3. each principle is approved by the SEC.

Explanation:

Generally Accepted Accounting Principles are primarily specific accounting guidelines controlled by the Financial Accounting Standards Board (FASB) for financial reporting purposes. As such the practice has become universally accepted overtime, and every accountant considers GAAPs useful to their profession. Furthermore, most companies see it as an authority in accounting reporting.

However, not all GAAPs are approved by the SEC, primarily the SEC is concerned about those principles and standards that affect companies with public traded securities while it delegates the setting of appropriate standards for private organisations to the Committee on Accounting Procedure which was then later delegated to the FASB.