The Development of GAAP in the United States
Setting GAAP These organizations access the development of GAAP in the United States. United States Securities and Exchange Commission (SEC) The SEC was created as a aftereffect of the Great Depression. At that time there was no anatomy ambience accounting standards. The SEC encouraged the enactment of clandestine standard-setting bodies through the AICPA and after the FASB, assertive that the clandestine area had the able knowledge, resources, and talents. The SEC works carefully with assorted clandestine organizations ambience GAAP, but does not set GAAP itself. American Institute of Certified Public Accountants (AICPA)
In 1939, apprenticed by the SEC, the AICPA appointed the Committee on Accounting Procedure (CAP). During the years 1939 to 1959 CAP issued 51 Accounting Research Bulletins that dealt with a array of appropriate accounting problems. However, this problem-by-problem access bootless to advance the abundant bare structured anatomy of accounting principles. Thus, in 1959, the AICPA created the Accounting Attempt Board (APB), whose mission it was to advance an all-embracing conceptual framework. It issued 31 opinions and was attenuated in 1973 for abridgement of abundance and abortion to act promptly.
After the conception of the FASB, the AICPA accustomed the Accounting Standards Executive Committee (AcSEC). It publishes: Audit and Accounting Guidelines, which summarizes the accounting practices of specific industries (e. g. casinos, colleges, airlines, etc. ) and provides specific advice on affairs not addressed by FASB or GASB. Statements of Position, which provides advice on banking advertisement capacity until the FASB or GASB sets standards on the issue. Practice Bulletins, which announce the AcSEC's angle on attenuated banking advertisement issues not advised by the FASB or the GASB. Banking Accounting Standards Board (FASB)
Realizing the charge to ameliorate the APB, leaders in the accounting profession appointed a Study Accumulation on the Enactment of Accounting Attempt (commonly accepted as the Wheat Committee for its armchair Francis Wheat). This accumulation bent that the APB charge be attenuated and a new standard-setting anatomy be created. This anatomy is composed of three organizations: the Banking Accounting Foundation (FAF, it selects associates of the FASB, funds and oversees their activities), the Banking Accounting Standards Advisory Council (FASAC), and the above operating alignment in this anatomy the Banking Accounting Standards Board (FASB).
FASB has 4 above types of publications: Statements of Banking Accounting Standards - the best accurate GAAP ambience publications. Added than 150 accept been issued to date. Statements of Banking Accounting Concepts - aboriginal issued in 1978. They are allotment of the FASB's conceptual framework activity and set alternating axiological objectives and concepts that the FASB use in developing approaching standards. However, they are not a allotment of GAAP. There accept been 7 concepts appear to date. Interpretations - adapt or extend absolute standards. There accept been about 50 interpretations appear to date.
Technical Bulletins - guidelines on applying standards, interpretations, and opinions. Usually solves some actual specific accounting affair that will not accept a significant, abiding effect. In 1984 the FASB created the Emerging Issues Task Force (EITF) which deals with new and abnormal banking affairs that accept the abeyant to become accepted (e. g. accounting for Internet based companies). It acts added like a botheration clarify for the FASB - the EITF deals with short-term, bound resolvable issues, abrogation long-term, added common problems for the FASB. Governmental Accounting Standards Board (GASB)
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