Which of the following statements is true of Generally Accepted Accounting Principles (GAAP)?
A)They are used by auditors as a guide,but only for non-audit services.
B)They are accepted and applied by accounting firms globally.
C)They cannot be modified once initially established by the American Institute of Certified Public Accountants.
D)They establish rules for how corporations and accounting firms prepare financial statements.

Question

Quizplus · Accepted Answer

Generally Accepted Accounting Principles (GAAP) establish rules for how corporations and accounting firms prepare financial statements. Choice A is incorrect because auditors use GAAP for both audit and non-audit services. Choice B is incorrect because while many countries have adopted GAAP, not all of them have. Choice C is incorrect because GAAP can be modified as needed.

Which of the Following Statements Is True of Generally Accepted