Essay Financial Accounting Standards Board and Fasb

Submitted By jewls674
Words: 422
Pages: 2

Financial Accounting Standards Board The Financial Accounting Standards Board (FASB) is a not-for-profit organization that was created in 1973 by the Financial Accounting Foundation (FAF). The board was created to replace the Committee on Accounting Procedure and the Accounting Principles Board which was part of the American Institute of Certified Public Accountants. The foundation created the FASB to improve the standards of accounting and reporting for nongovernmental entities. The FAF is responsible for oversight and administration for the FASB and to protect the independence and integrity of its standards. These standards are recognized by the SEC as authoritative. The mission of the FASB is to provide useful information to investors and others who use financial reports and to also keep standards current to reflect the changes in the way business is done and changes in the economic environment. The FASB is comprised of 7 fulltime members who are appointed by the foundation and can serve a maximum of two five year terms. To ensure that these 7 members remain impartial they are required to sever all ties to corporations they have previously served. The FASB establishes and improves standards only after research, due process and careful deliberation. In 1984 the FASB form the Emerging Issues Task Force (EITF) in order to provide timely responses to emerging financial issues. This is a 15 member group that includes people from the public and private sector to also include representatives from the FASB and an observer from the SEC. As issues arise the team tries to determine a course of action to take. If a decision can be reached an EITF is issued and the FASB does not need to be involved. In 2009 FASB was…