GAAP & IFRS Accounting Standards
Set your reporting framework per company to comply with US GAAP or International Financial Reporting Standards (IFRS).
Overview
BizBooks Pro supports the two major accounting frameworks used worldwide:
- US GAAP (Generally Accepted Accounting Principles) - The standard for US businesses, required for publicly traded US companies and widely used by private companies.
- IFRS (International Financial Reporting Standards) - Used in over 140 countries including the EU, UK, Canada, Australia, India, and most of Asia and Africa.
You can set the reporting standard independently for each company in your installation. This means you can manage a US parent company on GAAP and an international subsidiary on IFRS from the same BizBooks Pro installation.
Setting the Reporting Standard
During Company Creation
- Open the Company Manager
- Fill in the company name, fiscal year end, and accounting method
- Under Reporting Standard, select either US GAAP or IFRS
- Click Create Company
Changing an Existing Company
- Go to Settings
- Click the Edit button
- Find the Reporting Standard dropdown
- Select your preferred standard
- Click Save Changes
Key Differences Between GAAP and IFRS
| Area | US GAAP | IFRS |
|---|---|---|
| Balance Sheet title | Balance Sheet | Statement of Financial Position |
| Income Statement title | Income Statement (Profit & Loss) | Statement of Profit or Loss |
| Inventory costing | FIFO, LIFO, Average Cost | FIFO, Average Cost (LIFO prohibited) |
| Accounting methods | Cash and Accrual | Cash and Accrual |
| Countries | United States | 140+ countries |
How Reports Change
When you generate financial reports, BizBooks Pro automatically adjusts the following based on your company's reporting standard:
On-Screen Reports
- Report title updates (e.g., "Balance Sheet" becomes "Statement of Financial Position")
- A US GAAP or IFRS badge appears on every report alongside the Cash/Accrual badge
PDF Exports
- PDF report title reflects the correct standard
- The standard name (US GAAP or IFRS) is printed in the header
Print-Friendly Reports
- Print versions use the correct report title for the selected standard
- The standard is noted in the report header
Inventory Costing Rules
One of the most significant practical differences between GAAP and IFRS is the treatment of LIFO (Last In, First Out) inventory costing:
- Under GAAP: FIFO, LIFO, and Average Cost are all permitted
- Under IFRS: Only FIFO and Average Cost are permitted. LIFO is prohibited by IAS 2.
BizBooks Pro enforces this automatically. If your company is set to IFRS:
- The LIFO option is disabled in Inventory Settings
- Attempting to select LIFO will show a warning explaining the restriction
- If you switch a company from GAAP to IFRS while using LIFO, you will be prompted to change to FIFO or Average Cost
Frequently Asked Questions
Can I use different standards for different companies?
Yes. Each company has its own reporting standard setting. You can have some companies on GAAP and others on IFRS within the same installation.
Does changing the standard affect my transaction data?
No. Your underlying journal entries, account balances, and transaction history remain exactly the same. The standard only changes how reports are titled and formatted, and which inventory costing methods are available.
Which standard should I choose?
If your business is in the United States, GAAP is the standard choice. If you operate in Europe, the UK, Canada, Australia, or most other countries, IFRS is likely required. Consult your accountant if you are unsure.
Is this feature included in all plans?
Yes. GAAP and IFRS support is included in every BizBooks Pro plan at no additional cost.
Can I switch between standards?
Yes. You can change a company's reporting standard at any time in Settings. The only consideration is that switching to IFRS will require changing any LIFO inventory to FIFO or Average Cost.