Lecture Notes: SEC, IFRS, GAAP, and Accounting Assumptions

Vocabulary-style flashcards covering major regulatory bodies, standards, and accounting assumptions from the notes.

SEC

The U.S. government agency that oversees U.S. financial markets and accounting standard-setting bodies.

FASB

The primary accounting standard-setting body in the United States.

PCAOB

Determines U.S. auditing standards and reviews the performance of auditing firms.

IASB

The International Accounting Standards Board that issues International Financial Reporting Standards.

IFRS

International Financial Reporting Standards

GAAP

Generally Accepted Accounting Principles; U.S. accounting standards. Foreign companies wishing to trade on U.S. exchanges do not have to conform to GAAP if their reports conform to IFRS.

Monetary Unit Assumption

Only things that can be expressed in money are included in accounting records.

Economic Entity Assumption

Every economic entity can be separately identified and accounted for.

Periodicity Assumption

The life of a business can be divided into artificial time periods and useful reports can be prepared for the business.

Going Concern Assumption

The business will remain in operation for the foreseeable future.

Full Disclosure Principle

Requires that companies disclose sufficient details regarding circumstances and events that would make a difference to financial statement users.