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    Lean Accounting: Reasons to adopt lean vs. GAAP

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    Accounting for Lean is not embraced by GAAP for external reporting.
    What would the advantages and disadvantages of accounting for lean to be recognized by GAAP
    What would the advantages of having separate internal and external financial reporting for Accounting for Lean and GAAP.

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    https://brainmass.com/business/financial-accounting-bookkeeping/lean-accounting-reasons-adopt-lean-gaap-562723

    Solution Preview

    If lean accounting were permitted for GAAP, there would be better lean accounting practices. Right now, lean operations has yielded good results but lean accounting has not kept up with advances in operations (Can, 2013). Since the accounting team must create GAAP financials, their "production" is still mainly aimed at complying with those demands and the second goal, the support of lean practices, has lagged. If it were permitted, entire systems could be engineered to provide real-time valid financial information that operations could use. For instance, standard costing is not very useful to the cells on the factory floor who have to decide whether to make a new batch or have a vendor do the processing. Lean accounting could be responsive to this question as it primarily focuses on incremental costs for ...

    Solution Summary

    The discussion is 461 words plus two scholarly references. It discusses the dilemma of having two systems and why adopting lean practices is difficult.

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