The Financial Accounting Standards Board (FASB) is a private, non-for-profit organization whose primary purpose is to develop Generally Accepted Accounting Principles in the United States (US GAAP). The FASB's mission for the private sector is similar to that of the Governmental Accounting Standards Board (GASB) for local and state governments in the United States. The FASB was created in 1973, replacing the Accounting Principles Board and the Committee on Accounting Procedure of the American Institute of Certified Public Accountants (AICPA). According to its web site, the FASB's mission is "to establish and improve standards of financial accounting and reporting for the guidance and education of the public, including issuers, auditors, and users of financial information." Generally accepted accounting principles (GAAP) are the accounting rules used to prepare financial statements for publicly traded companies and many private companies in the United States. ... The Governmental Accounting Standards Board is a major American organization to develop generally accepted accounting principles (US GAAP) along with SEC, AICPA, and FASB. External links GASB Official Website Categories: Stub | Accounting ... 1973 (MCMLXXIII) was a common year starting on Monday. ... With over 350,000 CPA members (in 2005), the American Institute of Certified Public Accountants (AICPA) is the largest CPA professional organization in the United States of America. ...

The FASB is subject to oversight by the Financial Accounting Foundation (FAF), which selects the members of the FASB and GASB. The Sarbanes-Oxley Act of 2002 imposes fees on public companies and 100% of FASB's budget is funded by these fees; in addition, FASB sells its products under copyright claims that it asserts and uses the proceeds from sales to fund the operation of GASB.

The Board of Trustees of the FAF is selected in part by a group of organizations including the American Accounting Association; the American Institute of Certified Public Accountants; the CFA Institute; Financial Executives International; the Government Finance Officers Association; the Institute of Management Accountants; the National Association of State Auditors, Comptrollers and Treasurers; and the Securities Industry Association. [1]

The U.S. Securities and Exchange Commission (SEC) has statutory authority to establish financial accounting and reporting standards for publicly held companies under the Securities Exchange Act of 1934. Throughout its history, however, the SEC's policy has been to rely on the private sector for this function to the extent that the private sector demonstrates ability to fulfill the responsibility in the public interest. The SEC designated the FASB as the organization responsible for setting accounting standards for public companies in the U.S. The U.S. Securities and Exchange Commission, commonly referred to as the SEC, is the United States governing body which has primary responsibility for overseeing the regulation of the securities industry. ... The Securities Exchange Act of 1934 was a sweeping piece of legislation in the United States regulating the participants in the financial markets. ...

Before the present structure was created, financial accounting and reporting standards were established first by the Committee on Accounting Procedure of the AICPA (1936–1959) and then by the AICPA Accounting Principles Board (1959–73). Pronouncements of those predecessor bodies remain in force unless amended or superseded by the FASB. The Accounting Principles Board (APB) is the former authoritative body of the American Institute of Certified Public Accountants (AICPA). ...

The FASB is in the middle of a convergence project with the International Accounting Standards Board to make it easier for companies to report financial statements, so that separate financial statements are not needed for US and international markets. As part of the convergence project, the FASB has started transitioning from the principle of historical cost to fair value, a principle supported by the IASB. The International Accounting Standards Board (IASB) was founded on April 1, 2001 as the successor of IASC based in London, UK. IASB is responsible for setting International Accounting Standards. ... In accounting terminology, historical cost describes the original cost of an asset at the time of purchase or payment as opposed to its market value (saleable value, replacement value or value in present or alternative use). ... Definition Fair value, also called fair price, is a concept used in finance and economics. ...

The board's current (2004) chairman is Robert H. Herz.

See also

• FASB Interpretation Number (FIN)
• List of FASB Statements of Financial Accounting Concepts
• List of FASB Interpretations
• Lawrence A. Cunningham, Private Standards in Public Law (Article on FASB's Policy of Copyrighting and Selling its Materials Despite Being Funded by Public Company Fees), Michigan Law Review (2005)

Statements of Financial Accounting Concepts (in short Concepts Statements) are published by Financial Accounting Standards Board (FASB). ... FASB Interpretations are published by the Financial Accounting Standards Board (FASB). ...

Current issues

• Pooling of interests (Links to the IAS rules on pooling, which are not the same as FASB's)
• Stock option expensing

The International Accounting Standard 22, Business Combinations, became effective for annual financial statements for periods beginning on or after 1 January 1995. ... Stock option expensing is a method of accounting for the value of share options, distributed as incentives to employees, within the profit and loss reporting of a listed business. ...

Related Associations

• International Accounting Standards Board

The International Accounting Standards Board (IASB) was founded on April 1, 2001 as the successor of IASC based in London, UK. IASB is responsible for setting International Accounting Standards. ...

External links

• FASB Official Website