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FASB
The Financial Accounting Standards Board (FASB) is a private standard-setting body whose primary purpose is to establish and improve Generally Accepted Accounting Principles (GAAP) within the United States in the public's interest. The Securities and Exchange Commission (SEC) designated the FASB as the organization responsible for setting accounting standards for public companies in the US. The FASB replaced the American Institute of Certified Public Accountants' (AICPA) Accounting Principles Board (APB) on July 1, 1973. The FASB is run by the nonprofit Financial Accounting Foundation. FASB accounting standards are accepted as authoritative by many organizations, including state Boards of Accountancy and the American Institute of CPAs (AICPA). Structure The FASB is based in Norwalk, Connecticut, and is led by seven full-time Board members,Spiceland, David; Sepe, James; Nelson, Mark; & Tomassini, Lawrence (2009). ''Intermediate Accounting'' (5th Edition). McGraw-Hill/Irwin. ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Convergence Of Accounting Standards
The convergence of accounting standards refers to the goal of establishing a single set of accounting standards that will be used internationally.FASB, 2012International Convergence of Accounting Standards—Overview Retrieved on April 27, 2012. Convergence in some form has been taking place for several decades, and efforts today include projects that aim to reduce the differences between accounting standards. Convergence is driven by several factors, including the belief that having a single set of accounting requirements would increase the comparability of different entities' accounting numbers, which will contribute to the flow of international investment and benefit a variety of stakeholders. Criticisms of convergence include its cost and pace, and the idea that the link between convergence and comparability may not be strong. Overview The international convergence of accounting standards refers to the goal of establishing a single set of high-quality accounting standards to ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Mark-to-market
Mark-to-market (MTM or M2M) or fair value accounting is accounting for the "fair value" of an asset or liability based on the current market price, or the price for similar assets and liabilities, or based on another objectively assessed "fair" value. Fair value accounting has been a part of Generally Accepted Accounting Principles (GAAP) in the United States since the early 1990s, and is now regarded as the "gold standard" in some circles. Failure to use it is viewed as the cause of the Orange County Bankruptcy, even though its use is considered to be one of the reasons for the Enron scandal and the eventual bankruptcy of the company, as well as the closure of the accounting firm Arthur Andersen. Mark-to-market accounting can change values on the balance sheet as market conditions change. In contrast, historical cost accounting, based on the past transactions, is simpler, more stable, and easier to perform, but does not represent current market value. It summarizes past tra ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
FASB 133
Launched prior to the millennium, (and subsequently amended) FAS 133 ''Accounting for Derivative Instruments and Hedging Activities'' provided an "integrated accounting framework for derivative instruments and hedging activities." FAS 133 Overview Statements of Financial Accounting Standards No. 133, ''Accounting for Derivative Instruments and Hedging Activities'', commonly known as FAS 133, is an accounting standard issued in June 1998 by the Financial Accounting Standards Board (FASB) that requires companies to measure all assets and liabilities on their balance sheet at “fair value”. This standard was created in response to significant hedging losses involving derivatives years ago and the attempt to control and manage corporate hedging as risk management not earnings management. All derivatives within the scope of FAS133 must be recorded at fair value as an asset or liability. Hedge accounting may be applied if there is hedge documentation and gains and losses in the ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Fair Value
In accounting and in most schools of economic thought, fair value is a rational and unbiased estimate of the potential market price of a good, service, or asset. The derivation takes into account such objective factors as the costs associated with production or replacement, market conditions and matters of supply and demand. Subjective factors may also be considered such as the risk characteristics, the cost of and return on capital, and individually perceived utility. Economic understanding Vs market price There are two schools of thought about the relation between the market price and fair value in any form of market, but especially with regard to tradable assets: * The efficient-market hypothesis asserts that, in a well organized, reasonably transparent market, the market price is generally equal to or close to the fair value, as investors react quickly to incorporate new information about relative scarcity, utility, or potential returns in their bids; see also Rationa ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Fair Value Accounting And The Subprime Mortgage Crisis
The role of fair value accounting in the subprime mortgage crisis of 2008 is controversial. Fair value accounting was issued as US accounting standard SFAS 157 in 2006 by the privately run Financial Accounting Standards Board (FASB)—delegated by the U.S. Securities and Exchange Commission, SEC with the task of establishing financial reporting standards. This required that tradable assets such as Mortgage-backed security, mortgage securities be valued according to their current market value rather than their historic cost or some future expected value. When the market for such securities became volatile and collapsed, the resulting loss of value had a major financial effect upon the institutions holding them even if they had no immediate plans to sell them. Fair value accounting Definition of fair value accounting In 2006, the Financial Accounting Standards Board (FASB) implemented SFAS 157 in order to expand disclosures about fair value measurements in financial statements ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Financial Accounting Foundation
The Financial Accounting Foundation (FAF) is located in Norwalk, Connecticut, United States. It was organized in 1972 as a non-stock, Delaware Corporation. It is an independent organization in the private sector, operating with the goal of ensuring objectivity and integrity in financial reporting standards. The foundation is responsible for: * Establishing and improving financial accounting and reporting standards; * Educating constituents about those standards; * The oversight, administration, and finances of its standard-setting Boards, the Financial Accounting Standards Board (FASB) and the Governmental Accounting Standards Board (GASB), and their Advisory Councils; * Selecting the members of the standard-setting Boards and Advisory Councils; and * Protecting the independence and integrity of the standard-setting process. FAF operates four branches in its organization: * FASB * GASB * The Financial Accounting Standards Advisory Council (FASAC). This branch is composed of FA ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Accounting Principles Board
The Accounting Principles Board (APB) is the former authoritative body of the American Institute of Certified Public Accountants (AICPA). It was created by the American Institute of Certified Public Accountants in 1959 and issued pronouncements on accounting principles until 1973, when it was replaced by the Financial Accounting Standards Board (FASB). The APB was disbanded in the hopes that the smaller, fully independent FASB could more effectively create accounting standards. The APB and the related Securities Exchange Commission were unable to operate completely independently of the U.S. government. According to the SEC, "the overall record of the APB was a reasonably good one, but it seems likely that a smaller full-time body directly in control of its research holds promise of more success". Among others, Abraham Briloff was critical of some actions of the Accounting Principles Board. In response to APB 17, Briloff referred to the APB as the "Accounting Pragmatics Board".Br ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
SFAS 157
In September 2006, the Financial Accounting Standards Board (FASB) of the United States issued Statement of Financial Accounting Standards 157: Fair Value Measurements), which “defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles Publicly traded companies typically are subject to rigorous standards. Small and midsized businesses often follow more simplified standards, plus any specific disclosures required by their specific lenders and shareholders. Some firms operate on th ... (GAAP), and expands disclosures about fair value measurements.” This statement is effective for financial reporting fiscal periods commencing after November 15, 2007 and the interim periods applicable. Defining "fair value" Paragraph 5 of SFAS No. 157 (now known as ASC 820 in the updated FASB Codification) defines fair value as “the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
International Accounting Standards Board
The International Accounting Standards Board (IASB) is the independent accounting standard-setting body of the IFRS Foundation. The IASB was founded on April 1, 2001, as the successor to the International Accounting Standards Committee (IASC). It is responsible for developing International Financial Reporting Standards (IFRS) and for promoting their use and application."About the IASB" IFRS Foundation, 2018. Background and semantics The International Accounting Standards Committee (IASC) had been established in 1973 and had issued a number of standards known as International Accounting Standards (IAS). As the organization was reformed i ...[...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
The Wheat Committee
The Wheat Committee, an American study group on the establishment of accounting principles, was brought into being in 1971 in order to examine the operation of the Accounting Principles Board and to avoid governmental rule-making. It was headed by Francis Wheat. The Study Group submitted its recommendations to the AICPA Council in the spring of 1972, which led to the replacement of the Accounting Principles Board with the FASB, the Financial Accounting Standards Board The Financial Accounting Standards Board (FASB) is a private standard-setting body whose primary purpose is to establish and improve Generally Accepted Accounting Principles (GAAP) within the United States in the public's interest. The Securi ... in 1973. References {{DEFAULTSORT:Wheat Committee, The Accounting in the United States 1971 establishments in the United States ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Generally Accepted Accounting Principles
Publicly traded companies typically are subject to rigorous standards. Small and midsized businesses often follow more simplified standards, plus any specific disclosures required by their specific lenders and shareholders. Some firms operate on the cash method of accounting which can often be simple and straight forward. Larger firms most often operate on an accrual basis. Accrual basis is one of the fundamental accounting assumptions and if it is followed by the company while preparing the Financial statements then no further disclosure is required. Accounting standards prescribe in considerable detail what accruals must be made, how the financial statements are to be presented, and what additional disclosures are required. Some important elements that accounting standards cover include: identifying the exact entity which is reporting, discussing any "going concern" questions, specifying monetary units, and reporting time frames. Limitations The notable limitations of accountin ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Stephen Haddrill
Stephen Haddrill was chief executive officer of the Financial Reporting Council (FRC) in the United Kingdom. In November 2018 he announced he would be leaving the post. Biography Educated at Trinity School of John Whitgift from 1967 to 1974, Haddrill then studied history and economics at New College, Oxford. During the summer months his first taste of industry started with Findlay Durham & Brodie Electrical Ltd. He joined the Department of Energy in 1978, where he worked principally on nuclear power, and rose to the rank of Principal Private Secretary to the Energy Minister. From 1990 to 1994 he worked in Hong Kong as a member of the Governor's Central Policy Unit. From 1994 until 2005, he had a succession of roles in the Department of Trade and Industry (DTI), as a director of the Competitiveness Unit, Director of Employment Relations, then in Consumer Affairs. In early 2002 he was appointed as Director General of the DTI's Fair Markets Group. [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
