Final answer:
The use of subsidiary ledgers and control accounts is essentially the same under both GAAP and IFRS; they are designed to help maintain detailed transaction information while the general ledger presents a summarized balance.
Step-by-step explanation:
The statement “The use of subsidiary ledgers and control accounts are the same under GAAP and IFRS” is generally True. Subsidiary ledgers and control accounts are accounting tools used to organize and summarize transactions. Both GAAP (Generally Accepted Accounting Principles) and IFRS (International Financial Reporting Standards) allow for the use of subsidiary ledgers and control accounts to maintain detailed information separately while presenting a summarized balance in the general ledger.
Subsidiary ledgers are useful in breaking down the details of a general ledger control account. A common example would be the accounts receivable subsidiary ledger that itemizes individual customer balances, whereas the control account would show the total amount owed by all customers.
Control accounts serve as a summary account in the general ledger and are linked to their respective subsidiary ledgers for detailed tracking of transactions. This helps in streamlining the bookkeeping process and validating the accuracy of financial records.