Abstract
Each country has its own mutually accepted accounting standards, which are the rules that companies in these countries must follow when preparing accounting entries and financial statements. Accounting standards ensure the standardization of economic activities recorded by enterprises, and also provide a common index for fair evaluation of the financial status and operating results of enterprises. Nowadays, the accounting standards widely used in the world are generally divided into two categories: U.S. Generally Accepted Accounting Principles and International Financial Reporting Standards. This paper discusses the measurement differences under diverse accounting standards by taking the division of R&D expenditures, inventory management and the preparation of cash flow statements as examples through theoretical analysis and overview. This paper finds that despite the many differences between GAAP and IFRS, GAAP also shows a trend of convergence with IFRS in recent years under the background of the continuous development of the international financial system.
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