GAAP is required for companies in the US, while IFRS is used by international businesses. These principles were established and adapted largely to protect investors from misleading or dubious reporting. He has a CPA license in the Philippines and a BS in Accountancy...
It is used as a proxy for cash flow while being focused on the income statement. For example, you will hear bankers, private equity investors, and those kind of folks use EBITDA as a proxy for cash flow....