Accounting Reporting Criteria: GM and Toyota
Accounting Reporting Criteria (GM and Toyota)
Team B Megan Wooliver
September 7, 2010
Accounting Reporting Criteria In order to keep up with the times most organizations of today are finding themselves consistently coming up with different ways to keep accounting information personal as well as accurate. Providing good accounting information not only leads to better decisions but also increase in profit. Even two different organizations that provide a similar product or service have completely different ways of reporting their accounting information. Throughout this essay, Team B will compare and contrast many issues involved in the reporting process of two different organizations that both provide a similar product, the automobile. The first organization is General Motors, a United States company, and the second is Toyota, a foreign company. While there are similarities, there are also key differences in the reporting methods.
United States Accounting Standards
Accounting standards are key in the dissemination of information. When it comes to financial information these standards help regulate the industry and protect consumers. The United States has set specific standards that companies must meet in order to be legal within its borders. As a US born company, GM is held to these standards. The Standards include, GAAP, disclosures such as Sarbanes Oxley, and monitoring by the PCOAB.
GAAP (Generally Accepted Accounting Principles) were established by the FASB, which has been given the authority to monitor and enforce these regulations. These regulations include consistency, relevance, reliability and comparability. To be consistent, all information gathered must be the same throughout all periods and have relevant meaning so those using the information can make educated guesses regarding the stability of the company. In addition, the information must be verifiable and comparable to other companies in the industry. (Bradford, 2007). Meeting
Team B Megan Wooliver
September 7, 2010
Accounting Reporting Criteria In order to keep up with the times most organizations of today are finding themselves consistently coming up with different ways to keep accounting information personal as well as accurate. Providing good accounting information not only leads to better decisions but also increase in profit. Even two different organizations that provide a similar product or service have completely different ways of reporting their accounting information. Throughout this essay, Team B will compare and contrast many issues involved in the reporting process of two different organizations that both provide a similar product, the automobile. The first organization is General Motors, a United States company, and the second is Toyota, a foreign company. While there are similarities, there are also key differences in the reporting methods.
United States Accounting Standards
Accounting standards are key in the dissemination of information. When it comes to financial information these standards help regulate the industry and protect consumers. The United States has set specific standards that companies must meet in order to be legal within its borders. As a US born company, GM is held to these standards. The Standards include, GAAP, disclosures such as Sarbanes Oxley, and monitoring by the PCOAB.
GAAP (Generally Accepted Accounting Principles) were established by the FASB, which has been given the authority to monitor and enforce these regulations. These regulations include consistency, relevance, reliability and comparability. To be consistent, all information gathered must be the same throughout all periods and have relevant meaning so those using the information can make educated guesses regarding the stability of the company. In addition, the information must be verifiable and comparable to other companies in the industry. (Bradford, 2007). Meeting
References: And you thought stock options cost nothing (2006). Mercer. Retrieved September 6, 2009 from http://www.mercer.com/summary.htm?siteLanguage=100&idContent=1210840. Bradford, T (2007). GAAP and accounting standards. Retrieved September 6, 2009, from Suite101.com Web site: http://gaap-standard-accounting-practices.suite101.com/article.cfm/what_is_gaap Epstein, Barry J. (2008). IFRS versus GAAP. Russell Novak & Co., LLP. Retrieved February 22, 2009, from http://www.ifrsaccounting.com/ IASB.(2009) IABS Standards. Retrieved September 5, 2009 from http://iasb.co.uk/ J-GAAP: Company Act Regulates Accounting for Equity. (2007). Accounting diary in Japan. Retrieved September 6, 2009 from http://accountingdiaryinjapan.blogspot.com/2007/07/j-gaap-company-act-regulates-accounting.html United States International Grantmaking, (2009). Accounting issues. Retrieved September 5, 2009, from United States International Grantmaking Council on Foundations Web site: http://www.usig.org/accounting/accounting-us-orgs.asp