GAAP codification definition
/What is the GAAP Codification?
The GAAP codification is the primary source of all accounting standards contained within Generally Accepted Accounting Principles. The intent of the codification is to organize the thousands of page of accounting standards that had been promulgated over the years by a variety of committees and entities, such as statements of accounting standards, technical bulletins, practice bulletins, consensus positions, and implementation guides. The codification also includes the accounting positions taken by the Securities and Exchange Commission, which can be useful for those companies that are publicly held. Doing so has made it much easier to research GAAP information.
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GAAP Codification Categories
Someone researching GAAP can now search within the following general categories of codification information to locate what they need:
Topic 100: General Principles - Includes general accounting principles, the master glossary, and an overview of the structure of the accounting standards codification.
Topic 200: Presentation - Includes the general principles for the presentation of financial information.
Topic 300: Assets - Includes guidance on the accounting for many types of assets, such as receivables, investments, and securities.
Topic 400: Liabilities - Includes guidance on the accounting for and presentation of many types of liabilities.
Topic 500: Equity - Includes guidance on the accounting for and presentation of equity items in the financial statements.
Topic 600: Revenue - Includes guidance on the accounting for revenue, with an emphasis on the circumstances under which it may be recognized.
Topic 700: Expenses - Includes guidance on the accounting for various types of expenses.
Topic 800: Broad Transactions - Includes guidance on a variety of major transaction types, including business combinations, derivatives and hedging, financial instruments, and subsequent events.
Topic 900: Industry - Includes guidance that is specific to certain industries, such as mining, agriculture, and not-for-profit entities.
There are also a number of sub-categories within each of the primary topic areas just noted. A free basic view of the codification is available online.
How Authoritative is the GAAP Codification?
All information stated in the codification is considered to be authoritative in supporting accounting positions taken. Conversely, all accounting information not in the codification is considered to be non-authoritative for the purpose of supporting a position taken.
Who Maintains the GAAP Codification?
The codification is maintained on-line by the Financial Accounting Standards Board (FASB). The FASB also provides the codification in a multi-volume printed edition, which it updates once a year.
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