International Accounting Standards (IAS) were a set of guidelines for financial statements, but they were replaced by International Financial Reporting Standards (IFRS) in 2001. Since then, most major financial markets around the globe have embraced these new standards. Both IAS and IFRS were developed by the International Accounting Standards Board (IASB), which operates independently out

International Financial Reporting Standards (IFRS) are a collection of accounting guidelines designed for the financial statements of public companies, aiming to ensure consistency, transparency, and easy comparison globally. Right now, IFRS has comprehensive profiles for 168 jurisdictions, including those in the European Union. In contrast, the United States follows a different framework known as generally

The Governmental Accounting Standards Board (GASB) is a private organization that sets the accounting rules and standards, known as generally accepted accounting principles (GAAP), specifically for state and local governments across the U.S. Learn more about Governmental Accounting Standards Board The Governmental Accounting Standards Board (GASB) is a non-political, independent group that started in 1984.

The Financial Accounting Standards Board (FASB) is a nonprofit group that operates independently, and its main job is to set the rules for accounting and financial reporting for both businesses and nonprofits in the U.S., all in line with generally accepted accounting principles (GAAP). Established in 1973, the FASB took over from the Accounting Principles

Generally accepted accounting principles, or GAAP, are a collection of rules and standards for accounting that are regularly updated by the Financial Accounting Standards Board (FASB) and the Governmental Accounting Standards Board (GASB). These principles help maintain consistency, accuracy, and transparency in financial reporting across different sectors in the U.S. Public companies are required to

Accumulated depreciation is a way to track how much an asset’s value decreases over time until it reaches the end of its useful life. You can figure this out using one of six different methods: straight line, declining balance, double-declining balance, sum-of-the-years’ digits, units of production, or half-year recognition. When you buy an asset for

Gross profit (GP) is what a company makes after taking out the costs of making and selling its products or services. You might also hear it called sales profit or gross income. To figure out gross profit, you look at the income statement and subtract the cost of goods sold (COGS) from the total revenue.

Cost of goods sold (COGS) is all about the direct expenses tied to making the products a company sells. This includes the costs for materials and labor that go straight into producing those goods. It doesn’t cover indirect costs like shipping or sales team expenses. You might also hear cost of goods sold called “cost

Gross income (GI) for a person, often referred to as gross pay on a paycheck, is the total amount they earn before any taxes or deductions are taken out. This encompasses earnings from various sources, not just from a job, and it can include non-cash income like property or services as well. For businesses, gross

Net income (NI), often referred to as net earnings, is a key figure for investors to evaluate how much revenue surpasses a company’s expenses. To calculate net income, you take sales and subtract costs like goods sold, selling and administrative expenses, operating costs, depreciation, interest, taxes, and any other expenses. You can find net income