Do all US companies have to follow GAAP reporting standards for profits and losses?

Question

Do all US companies have to follow GAAP reporting standards for profits and losses when reporting to the IRS and investors?

Answer 1

From the CFA Institute:

Companies that issue stock are held to this standard by SEC, which requires yearly external audits by independent accountants, but companies without external investors are not obliged to follow this standard.

So publicly traded companies are required to use GAAP, but privately-help companies are not, though many larger ones do anyway since it adds credibility to their financials and makes it easier to get financing from banks and investors.

Answer 2

Article from a CPA firm:

GAAP basis requires accruals

Small businesses often find it easier to use a cash basis accounting method than an accrual basis.

As of a 2019 tax law change, IRS accepts cash basis accounting for businesses having no more than $25 million in gross revenue.