IntroductionGenerally Accepted Accounting Principles (GAAP) were first established in the 1930s in response to the historic stock market crash of 1929. Today, GAAP is influenced by several organizations including the Financial Accounting Standards Advisory Council (FASAC), the Securities and Exchange Commission (SEC), the American Institute of Certified Public Accountants (AICPA), and the Internal Revenue Service (IRS). Publicly traded companies are required to follow GAAP in the United States. Many other countries have their own accounting standards. In today's global economic climate, many businesses need to grow to survive. A small business may choose to merge with another larger company, while a large company may want to acquire a small company to expand under certain conditions. More and more international mergers and acquisitions are occurring today. But how would they adapt to the ever-changing accounting standards in different countries? There are complications in balance sheet consolidation when companies engage in mergers/acquisitions. In order to adapt to the new business environment, GAAP is also making changes. International Financial Reporting Standards (IFRS) were first developed by the International Accounting Standard Board in 1973. IFRS quickly gained popularity. Nowadays, over 100 countries recognize IFRS. As the largest economy in the world, the United States (United Nations 2012); however, it did not plan to implement IFRS until 2011. In this article, we will discuss future possibilities for convergence between US GAAP and IFRS. Acquisition Methods A company can complete an acquisition in several ways: statutory merger, statutory consolidation, asset acquisition or st...... middle of paper ...... AAP is rules-based, while l 'IFRS is principles based (Carmona & Trombetta, p.455). The International Accounting Standard Board (IASB) developed IFRS believing that they are the best set of principles to reflect a company's financial situation in the most accurate, reliable and transparent manner (Bozkurt p.16). To be able to provide the most transparent financial reporting possible to investors, accountants must be able to gather accurate information and follow standards that will allow them to do so. Many countries are doing the same business in different countries in this economy. However, they may produce different financial statements based on the accounting principles used despite the fact that they may have similar financial situations. There are many different areas between GAAP and IFRS. In 2011, the SEC's Office of the Chief Accountant released a report identifying the differences.