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Accounting Principles Definition [Video]

Accounting principles are the rules and guidelines that companies must follow when reporting financial data. The Financial Accounting Standards Board (FASB) issues a standardized set of accounting principles in the U.S. referred to as generally accepted accounting principles (GAAP).

The ultimate goal of any set of accounting principles is to ensure that a company's financial statements are complete, consistent, and comparable. This makes it easier for investors to analyze and extract useful information from the company's financial statements, including trend data over a period of time. It also facilitates the comparison of financial information across different companies. Accounting principles also help mitigate accounting fraud by increasing transparency and allowing red flags to be identified.

Publicly traded companies in the United States are required to regularly file generally accepted accounting principles, or GAAP-compliant financial statementsin order to remain publicly listed on stock exchanges. Chief officers of publicly traded companies and their independent auditors must certify that the financial statements …

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Master Investment Banking with WallStreetMojo's IBMP Course! [Video]

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Resources for Accountants

Comprehensive Training with WallStreetMojo! [Video]

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Master Finance with WallStreetMojo Membership One-Time Payment, Lifetime Access! [Video]

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