Accounting
GAAP
Quick definition
Generally Accepted Accounting Principles — the US accounting standard.
GAAP is the common set of rules governing US financial reporting, set by the FASB. Most investors and all auditors expect GAAP-compliant financials. Non-GAAP adjustments (like backing out SBC) are common in investor reporting but must be clearly labeled.
Related accounting terms
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Frequently asked questions
- What is GAAP?
- GAAP is the common set of rules governing US financial reporting, set by the FASB. Most investors and all auditors expect GAAP-compliant financials. Non-GAAP adjustments (like backing out SBC) are common in investor reporting but must be clearly labeled.
- Why is GAAP important for startups?
- GAAP is a accounting concept that matters for startup founders because it directly affects fundraising readiness, financial decision-making, or operational discipline at the stage where mistakes are expensive to undo. Founders who understand it have a meaningfully easier time in diligence, board meetings, and investor conversations.
- What category does GAAP belong to?
- GAAP is a Accounting term in the StartupCFO finance glossary — alongside other accounting concepts that founders, CFOs, and accountants use in daily startup operations and reporting.
- Where can I learn more about GAAP?
- Beyond this definition, see the related accounting terms below, or explore StartupCFO's insights and tools that put GAAP in context. For specific situations, talk to a fractional CFO who can walk through your numbers.
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