Generally Accepted Accounting Principles (GAAP) Law and Legal Definition

Generally accepted accounting principles or GAAP refer to conventions, rules, and procedures that define approved accounting practices at a particular time. These principles are issued by the Financial Accounting Standards Board for use by accountants in preparing financial statements. Apart from guidelines, GAAP also provides detailed practices and procedures. Generally accepted principles are derived from a variety of sources, including promulgations of the Financial Accounting Standards Board and its predecessor, the Accounting Principles Board, and the American Institute of Certified Public Accountants. This is also referred as generally accepted accountancy principles.