Who has the legal authority to establish the Generally Accep

Who has the legal authority to establish the Generally Accepted Accounting Principles (GAAP)? Has this organization made any of these rules? Why or Why not?

Solution

GAAP is set by FASB, Financial accounting standards board . They primarily deal with accounting standards of companies based in US. They provides accounting treatment for revenue recognition, expense recognition and other accounting line items.

GAAP principles are made so as to promote transparency in accounting . But it doesn\'t ensures that no accounting manipulation will take place . Scrutiny on financial statements still need to done.