You will reflect on the value-add of GAAP accounting standards and consider ethical issues presented by rules
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Question:
You will reflect on the value-add of GAAP accounting standards and consider ethical issues presented by rules vs. principles-based standards.
This week, you learned about the rules of GAAP and the role GAAP plays in defining accounting standards, discuss whether you think GAAP should remain rules-based:
- Should U.S. accounting standards follow international accounting standards and become principles-based? What are the pros and cons of rules vs. principles-based accounting? What method do you favor and why?
What are the potential ethical issues presented by rules vs. principles-based standards? Would you see events and/or circumstances differently between the two approaches or not? Present a specific scenario in which you believe this could play out differently under each approach. This example can be either professional or personal?
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