Baby GAAP, A Creditor\u27s Solution to Financial Reporting

The purpose of this paper is to explore problems in current GAAP, including earnings management and illogical accounting practices. The paper then looks at proposed solutions to these problems, but shows how, from a creditor\u27s perspective, these solutions fall short. My conclusion is that by creating two sets of GAAP, one for large publicly traded companies and one for smaller privately held companies, financial statements will be more representationally faithful for the creditors utilizing the financial statements