In measuring and reporting financial results, U.S. companies have long followed the set of standards and guidelines known as generally accepted accounting principles. But now that accounting scandals have exposed GAAP’s vulnerability to creative interpretation, the Securities and Exchange Commission and the Financial Accounting Standards Board, or FASB, are opening the door to international influence on U.S. financial reporting. A shift toward global reporting standards is now inevitable, and its impact on U.S. businesses will be far-reaching.
A version of this article appeared in the April 2003 issue of Harvard Business Review.
