Financial Accounting Standards Board
The Financial Accounting Standards Board is a major organization whose primary purpose is to develop Generally Accepted Accounting Principles in the United States (US GAAP), similar to what the Government Accounting Standards Board (GASB) does for local and state governments in the United States. It was created in 1973, replacing the Accounting Principles Board and the Committee on Accounting Procedure of the AICPA. The federal organization is responsible for maintaining independence standards in accounting, the powers of which come from the Congress.
The FASB is not a governmental body and it has no official legal standing. 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 Commission’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 FASB is part of a structure that is independent of all other business and professional organizations. Before the present structure was created, financial accounting and reporting standards were established first by the Committee on Accounting Procedure of the American Institute of Certified Public Accountants (1936–1959) and then by the Accounting Principles Board, also a part of the AICPA (1959–73). Pronouncements of those predecessor bodies remain in force unless amended or superseded by the FASB.
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, something the IASB belives in dearly.
The board's current (2004) chairman is Robert H. Herz.
- Financial Accounting Standards (FAS)
- FASB Interpretation Number (FIN)
- List of FASB Statements of Financial Accounting Concepts
- List of FASB Interpretations