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In contrast, IFRS considers each interim report as a standalone period, and while an MD&A is allowed, it is not required. US GAAP considers each quarterly report as an integral part of the fiscal year, and a Management’s Discussion and Analysis section (MD&A) is required. However, IFRS provides greater discretion with respect to which section of the Statement of Cash Flows these items can be reported in. US GAAP requires that interest expense, interest income and dividend income be accounted for in the operating activities section, and dividends paid be reported in the financing section. (US GAAP) Balance Sheet Comparison The Statement of Cash Flows non-current assets before current assets).
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current assets before non-current assets), whereas IFRS reports assets in increasing order of liquidity (i.e. US GAAP lists assets in decreasing order of liquidity (i.e. However, many companies following IFRS choose to report three periods.
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US GAAP requires presenting three periods, compared to two for IFRS. The following differences outlined in this section affect what financial information is presented, how it is presented, and where it is presented. There are four main areas where the two diverge in financial reporting: The following discussion highlights specific differences between the two sets of standards that may be useful to users of financial statements. While there are examples to support these descriptions, there are also meaningful exceptions that make this distinction not very helpful. Generally, IFRS is described as more principles-based whereas US GAAP is described as more rules-based. Blue Areas Represent Areas where IFRS is Required for Domestic Public Companies (Source: IFRS) Differences between US GAAP vs IFRS