Final answer:
The standard for reporting external financial reports is the Generally Accepted Accounting Principles (GAAP), which are designed to ensure clarity and consistency in financial reporting across different industries.
Step-by-step explanation:
The reporting standard for external financial reports is d) generally accepted accounting principles.
Generally Accepted Accounting Principles (GAAP) are a common set of accounting principles, standards, and procedures that companies and their accountants must follow when they compile their financial statements. GAAP is a combination of authoritative standards (set by policy boards) and simply the commonly accepted ways of recording and reporting accounting information.
GAAP improves the clarity of the communication of financial information. It provides a coherent system of rules and procedures. This makes it easier for investors, stakeholders, and government agencies to understand and use the reported information in a consistent and reliable manner, regardless of the industry.