ECONOMICS

Detailed explanation-1: -Generally accepted accounting principles (GAAP) are used to prepare and report financial statements. The 10 principles of GAAP pertain to accounting consistency, transparency and ethics. Although GAAP is only mandatory for publicly traded and regulated companies, it is strongly encouraged for all companies.

Detailed explanation-2: -Generally accepted accounting principles, or GAAP, are standards that encompass the details, complexities, and legalities of business and corporate accounting. The Financial Accounting Standards Board (FASB) uses GAAP as the foundation for its comprehensive set of approved accounting methods and practices.

Detailed explanation-3: -Generally Accepted Accounting Principles (GAAP or US GAAP) are a collection of commonly-followed accounting rules and standards for financial reporting.

Detailed explanation-4: -Prudence is the exercise of caution when making judgements under conditions of uncertainty. The exercise of prudence means that assets and income are not overstated and liabilities and income are not understated.