Generally Accepted Accounting Principles (GAAP)

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What is “Generally Accepted Accounting Principles” (GAAP)?

Generally Accepted Accounting Principles (GAAP) is the set of accounting standards, conventions and rules that public and many private companies in the United States must follow when preparing financial statements. U.S. GAAP is established by the Financial Accounting Standards Board (FASB) and is enforced by the SEC for public companies. GAAP ensures financial statements are comparable, consistent and transparent across companies.

Core GAAP principles

  • Accrual basis: revenue recognised when earned, expenses when incurred (regardless of cash).
  • Consistency: same methods applied period to period.
  • Matching: expenses matched with revenue they helped produce.
  • Conservatism: expenses and liabilities recognised promptly; revenue only when realised.
  • Materiality: immaterial items can be simplified; material items require precise treatment.
  • Full disclosure: all relevant information disclosed.

GAAP vs. IFRS / TFRS

  • GAAP (U.S.): rules-based, more prescriptive.
  • IFRS (International Financial Reporting Standards): principles-based, more flexible; used in EU, UK, Türkiye and most jurisdictions outside the U.S.
  • TFRS (Türkiye Finansal Raporlama Standartları): Türkiye’s IFRS-aligned standards published by KGK.
  • Major differences include treatment of LIFO inventory, development costs, revaluation of fixed assets — though IFRS 15/16 have narrowed many gaps.

Why GAAP matters for startups

  • U.S. investors expect GAAP-compliant statements for Series A and beyond.
  • Audit requires GAAP compliance.
  • IPO process requires GAAP-compliant historical financials.
  • M&A diligence reads GAAP statements; non-GAAP requires reconciliation.

Türk şirketlerinde uygulama

ABD’ye genişleyecek veya ABD investor için GAAP uyumlu rapor üretmek gerekirken yerel raporlama TFRS ile yapılır. Cyprus/Delaware HoldCo + Türkiye OpCo yapısında HoldCo seviyesinde paralel GAAP raporlaması yaygındır. Vergi raporlaması ayrıca Maliye’ye Türk muhasebe standartlarına göre yapılır — üç ayrı raporlama seti tutulması büyüme aşamasında standarttır.

Do: establish GAAP-compliant bookkeeping when first U.S. investor is on the cap table; reconcile to local statutory reporting.
Don’t: mix non-GAAP and GAAP numbers in pitch decks — investors normalise and trust drops.

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