The benefits of GAAP is that, they help users of institutions financial statements in getting useful information for decision making.
The financial statements of entities are like information systems that gives investors and other entities that carry out business activities with a given business all the information they need when making decisions (Dauderis & Annand, 2014).
For example, the faithful representation principle ensures external users of a certain entity are able to get information that has a clean bill of health.
Take an example of suppliers of a corporation, GAAP shields them from supplying to an institution which is sinking and therefore prevents them from incurring huge losses.
