In accounting, private companies are treated differently than governmental and non-profit companies. However governmental and non-profit companies use different reporting requirements from the private sector. The requirements for governmental companies use the Government Accounting Standards Board (GASB), whereas profit and non-profit companies use the Financial Accounting Standards Board. This paper will explain the purpose, discus the similarities, and differences between the GASB and FASB. Governmental
Accounting Regulatory Bodies Paper Introduction The success of a company is very dependent upon its financial accounting. In accounting there are numerous Regulatory bodies that govern the accounting world. These companies are extremely important to a company because they set the standards when it comes to the language and decision making of a company. These regulatory bodies can be structured as agencies, associations, commissions, and boards. Without companies like the Security and Exchange
of accounting standards that accurately represents all of their financial activity in a manner that is useful to concerned parties. To resolve these discrepancies three separate standard setting bodies have been tasked with developing Generally Accepted Accounting Principles (GAAP) for these different organizations: The Federal Accounting Standards Advisory Board (FASAB) for federal accounting, the Governmental Accounting Standards Board (GASB) for SLG, and the Financial Accounting Standards Board
To best serve the needs of SMEs, the BRP’s final recommendation to the FAF Board of Trustees is GAAP with exceptions and modifications under the direction of a new and separate private company standards board (BRP, 2011, p. 2). The new board with the oversight of the FAF would work closely with the FASB and a have final rule over exceptions and modifications to current U.S. GAAP (BRP, 2011, p. 2). Although the FAF did agree the best way to accommodate SMEs is exceptions and modifications to current
The accounting profession, along with its standards and regulatory sources, have changed dramatically in recent years. The accounting profession and its standards once consisted of standardized financial reporting compliance; however, it has now evolved into a specialized profession influenced by its constantly evolving standards resulting in accounting and legal technicalities. Many factors constituted the change, in addition to factors that constituted the need for its change; for example, corporate
Explain GAAP. GAAP (generally accepted accounting principles) is a collection of commonly-followed accounting rules and standards for financial reporting. The acronym is pronounced "gap." GAAP specifications include definitions of concepts and principles, as well as industry- specific rules. The purpose of GAAP is to ensure that financial reporting is transparent and consistent from one organization to another. There is no universal GAAP standard and the specifics vary from one geographic
SFAS 117 Ruling According to the Financial Accounting Standards Board (FASB), the purpose of SFAS 117 was to enhancing the relevance, understandability, and comparability of financial statements issued by nonprofit organizations (McLaughlin, 2009). The intention of the SFAS 117 was to make nonprofit organization financial statements readable as well as usable by stock holders of the nonprofit organization. With this being implemented there are now three types of funds which include; unrestricted
Pharmacists play a vital role in the society. To practice as a pharmacist you have to be registered with America Pharmacists Association. To be a pharmacist it may take up to eight. You need to take four years in undergraduate to be a fully recognized pharmacist. You will also need to pass the North American Pharmacist Licensure exam and the state exam to become a fully accredited pharmacist. In current world the medical practitioners faces a lot of ethical dilemmas. According to ASHP foundation
According to the auditing standard, “Materiality means the amount or amounts set by the auditor at less than materiality for the financial statements as a whole to reduce, to an appropriately low level the probability that the aggregate of uncorrected and undetected misstatements exceeds materiality for the financial statements as a whole” (Canadian Institue of Chartered Accountants 2012a). We might also consider out textbooks definition “The magnitude of an omission or misstatement, in the light
Accounting for financial instruments and the issues that go along with it have been an ongoing issue throughout the years for businesses. As a result the Financial Accounting Standards Board have handed down decisions regarding the valuation method that should be used. Whether these decisions are truly the best way to value financial instruments has been up for debate. The earliest decision came down in May of 1993 when the Financial Accounting Standards Board passed Statement of Financial Accounting
Introduction Generally accepted accounting principles (GAAP) were first established in the 1930s in response to the historical stock market crash in 1929. Nowadays GAAP is influenced by several organizations including the Financial Accounting Standards Advisory Council (FASAC), Securities and Exchange Commission (SEC), American Institute of Certified Public Accountants (AICPA) and the Internal Revenue Service (IRS). Publicly trade companies are required to follow GAAP in the United States. Many other
Accounting standard is a set of guidelines that financial accountants have to follow in preparation and presentation of business incomes, expenses, assets and liabilities. This helps to ensure that the treatments of these items are fair and just, hence making the financial statements a reliable source for users. There are many types of accounting standards being used all over the world. More than 120 countries such as the European Union, Singapore, India, Taiwan, Australia and Canada adopt the International
IFRS stands for International Financial Reporting Standards, which is a set of accounting standards that can be used globally by public companies for financial reporting. The set of standards are governed by the International Accounting Standards Board that is based in London. The purpose of converting the U.S to these standards is to streamline all the companies that are abroad and in the United States as far as financial reporting. This process is supposed to produce cost savings for companies
Off-balance sheet accounting boils down to the simple question: should the sponsoring entity consolidate or not? From the 1980s to the 1990s it was common for sponsoring companies to avoid consolidations despite the fact that they maintained control of assets of special purpose entities (SPEs). Ultimately, this allowed sponsoring companies to hide losses and debt from their own financial statements. From a principles-based view, companies should have to report the assets of a SPE on their financial
Marshall (2004), "accounting is the process of identifying, measuring, and communicating economic information about an organization for the purpose of making decisions and informed judgements" (p. 3). Specifically, financial accounting "refers to the process that results in the preparation and reporting of financial statements for an entity" (Marshall, McManus, & Viele, p. 5). While many entities prepare their own financial statements, firms can also contract with a public accounting firm or a Certified
over the field of accounting. These general rules, known as basic accounting principles and guidelines, shape the groundwork on which more thorough, complex, and legalistic accounting rules are based. The Financial Accounting Standards Board (FASB) uses the basic accounting principles and guidelines as a foundation for their own comprehensive and complete set of accounting rules and standards. GAAP is exceptionally useful because it attempts to regulate and normalize accounting definitions, assumptions
financial information to users of such information in various forms. Emphasis is made that the most common format of formal financial reporting are financial statements, which are actually prepared in accordance with rigorously applied standards defined by professional accounting bodies developed according to the legal and professional framework of a specific locale. A financial statement also known as a financial report is a formal record of the financial activities of a business, person, or other entity
The IASC Board approved the IASB (International Accounting Standards Board) Framework ( in April, 1989) which was a successor of the IASC Board, and it accepted its Framework in April 2001 (Wells, 2011)[ Wells, M J. C., (2011). Framework-based Approach to Teaching Principle-based Accounting Standards., Accounting Education: an international journal., 20(4), 303-316.]. International standards are developed by IASB which are named International Financial Reporting Standards (IFRS). Although IASB took
What would financial statements look like if there were no accounting standards?” Accounting standards are a set of principle that govern current accounting practice and are used as a reference to determine the appropriate treatment of complex transactions. Having financial statements in the same format allow them to be compared and in this essay we shall discuss how the accounting standards came about, and why it continues to exist until this very day, as the format of such practice has changed
Presentation Requirements of International Accounting Standard 1 will Undermine the UK’s View of True and Fair During the last 20/30 years there has been an increase in trade and communication. It is easier for people to do business across the world as the new technology allows this to be possible. The problem with this is that different countries have different ways of accounting standards, and therefore there is a problem on how to account standards. Hence, during the last years the debate on