We are independent & ad-supported. We may earn a commission for purchases made through our links.
Advertiser Disclosure
Our website is an independent, advertising-supported platform. We provide our content free of charge to our readers, and to keep it that way, we rely on revenue generated through advertisements and affiliate partnerships. This means that when you click on certain links on our site and make a purchase, we may earn a commission. Learn more.
How We Make Money
We sustain our operations through affiliate commissions and advertising. If you click on an affiliate link and make a purchase, we may receive a commission from the merchant at no additional cost to you. We also display advertisements on our website, which help generate revenue to support our work and keep our content free for readers. Our editorial team operates independently of our advertising and affiliate partnerships to ensure that our content remains unbiased and focused on providing you with the best information and recommendations based on thorough research and honest evaluations. To remain transparent, we’ve provided a list of our current affiliate partners here.

What Is a GAAP Disclosure?

K.C. Bruning
By
Updated May 16, 2024
Our promise to you
SmartCapitalMind is dedicated to creating trustworthy, high-quality content that always prioritizes transparency, integrity, and inclusivity above all else. Our ensure that our content creation and review process includes rigorous fact-checking, evidence-based, and continual updates to ensure accuracy and reliability.

Our Promise to you

Founded in 2002, our company has been a trusted resource for readers seeking informative and engaging content. Our dedication to quality remains unwavering—and will never change. We follow a strict editorial policy, ensuring that our content is authored by highly qualified professionals and edited by subject matter experts. This guarantees that everything we publish is objective, accurate, and trustworthy.

Over the years, we've refined our approach to cover a wide range of topics, providing readers with reliable and practical advice to enhance their knowledge and skills. That's why millions of readers turn to us each year. Join us in celebrating the joy of learning, guided by standards you can trust.

Editorial Standards

At SmartCapitalMind, we are committed to creating content that you can trust. Our editorial process is designed to ensure that every piece of content we publish is accurate, reliable, and informative.

Our team of experienced writers and editors follows a strict set of guidelines to ensure the highest quality content. We conduct thorough research, fact-check all information, and rely on credible sources to back up our claims. Our content is reviewed by subject-matter experts to ensure accuracy and clarity.

We believe in transparency and maintain editorial independence from our advertisers. Our team does not receive direct compensation from advertisers, allowing us to create unbiased content that prioritizes your interests.

A generally accepted accounting principles (GAAP) disclosure is a financial disclosure which reveals information about an organization’s status regarding the guidelines of the Financial Accounting Standards Board (FASB). It is actually a series of different statements covering areas such as income tax, risk, and contingencies. There are several different kinds of GAAP disclosure. Some are required and others are recommended.

In the early 1930s the Securities and Exchange Commission (SEC) in the United States of America gained the authority to require businesses to disclose certain factors of the manner in which they did business. The SEC gave the FASB the power to develop these requirements, thus giving birth to the GAAP disclosure. This information must be submitted to the government at scheduled intervals.

The purpose of a GAAP disclosure is to ensure that businesses are acting legally and using appropriate accounting practices. It is meant to show whether or not the company is on the right track. This includes determining whether the business is in danger of violating regulations due to the direction of its current activity.

One of the most important aspects of GAAP disclosure is the full disclosure requirement. This is a government regulation which states that all significant issues currently or soon affecting the financial status of a business must be included in statements. This includes conditions which can affect a company’s productivity and cash flow, such as legal problems. Money issues such as incomplete transactions must also be disclosed.

The type and number of GAAP disclosures that an organization must make depends upon the nature of the company. An accountant will often research requirements and prepare a checklist of which areas must be addressed. As regulations will periodically change, it is advisable to update this checklist before every reporting period.

It can take some skill to appropriately prepare GAAP disclosures. This is primarily because several of the regulations are open to interpretation. One issue to consider is whether the information disclosed is accurate. An accountant may present information in the wrong way, whether or not by design. It is also important that all information reported is complete so that reviewing parties will be able to make an accurate assessment of the company’s status.

There are several ways a company can improve the accuracy and completeness of its GAAP disclosures. The first step is to hire ethical, experienced accounting staff members who possess a clear understanding of GAAP requirements and recommendations. Then it is advisable to ensure that these professionals have the necessary resources to stay updated on all changes to GAAP disclosure requirements, in addition to providing continuing education on the process as necessary.

SmartCapitalMind is dedicated to providing accurate and trustworthy information. We carefully select reputable sources and employ a rigorous fact-checking process to maintain the highest standards. To learn more about our commitment to accuracy, read our editorial process.
Link to Sources
K.C. Bruning
By K.C. Bruning
Kendahl Cruver Bruning, a versatile writer and editor, creates engaging content for a wide range of publications and platforms, including SmartCapitalMind. With a degree in English, she crafts compelling blog posts, web copy, resumes, and articles that resonate with readers. Bruning also showcases her passion for writing and learning through her own review site and podcast, offering unique perspectives on various topics.
Discussion Comments
K.C. Bruning
K.C. Bruning
Kendahl Cruver Bruning, a versatile writer and editor, creates engaging content for a wide range of publications and...
Learn more
SmartCapitalMind, in your inbox

Our latest articles, guides, and more, delivered daily.

SmartCapitalMind, in your inbox

Our latest articles, guides, and more, delivered daily.