Introduction

Over time, the entities responsible for promulgating U.S. financial accounting standards have changed, as have the names of the guidance and standards that they produce. The following list identifies entities; click on each to review details regarding each entity, its role in standard setting, and the types of guidance it issued. After reviewing the role of each entity, select Check Your Understanding.

History of Accounting Standard Setting

The SEC delegates its authority for establishing U.S. financial accounting standards. Complete boxes 1, 2 and 3 in this diagram by selecting the name of the standard setting body for each time period. Complete boxes 4, 5, and 6 by selecting the name of the standards issued by the respective standard-setting bodies.

1. Select an answer Committee on Accounting Procedures (CAP) Accounting Principles Board (APB) Financial Accounting Standards Board (FASB)

2. Select an answer Committee on Accounting Procedures (CAP) Financial Accounting Standards Board (FASB) Accounting Principles Board (APB)

3. Select an answer Financial Accounting Standards Board (FASB) Committee on Accounting Procedures (CAP) Accounting Principles Board (APB)

4. Select an answer 31 Opinions and four Statements Issued Accounting Standards Updates (ASUs) Issued Accounting Research Bulletins (ARBs) Issued

5. Select an answer 31 Opinions and four Statements Issued Accounting Standards Updates (ASUs) Issued Accounting Research Bulletins (ARBs) Issued

6. Select an answer 31 Opinions and four Statements Issued Accounting Research Bulletins (ARBs) Issued Accounting Standards Updates (ASUs) Issued

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Standard-Setting Organizational Structure

The FASB is part of a larger U.S. standard-setting organizational structure. Click on each entity to review details about its role in standard-setting. After reviewing the role of each entity, select Check Your Understanding.

The overall U.S. financial accounting standard setting organizational structure is illustrated in this diagram. Complete the diagram by entering the name of each standards board in the green rectangles (alphabetical left to right), the associated advisory council in each green oval, and the correct entity creating guidance that is subject to approval by the a board before becoming part of U.S. GAAP (alphabetical top to bottom).

1. Select an answer Emerging Issues Task Force (EITF) Private Company Council (PCC) Financial Accounting Standards Board (FASB) Governmental Accounting Standards Board (GASB) Financial Accounting Standards Advisory Council Governmental Accounting Standards Advisory Council

2. Select an answer Emerging Issues Task Force (EITF) Private Company Council (PCC) Financial Accounting Standards Board (FASB) Governmental Accounting Standards Board (GASB) Financial Accounting Standards Advisory Council Governmental Accounting Standards Advisory Council

3. Select an answer Emerging Issues Task Force (EITF) Private Company Council (PCC) Financial Accounting Standards Board (FASB) Governmental Accounting Standards Board (GASB) Financial Accounting Standards Advisory Council Governmental Accounting Standards Advisory Council

4. Select an answer Emerging Issues Task Force (EITF) Private Company Council (PCC) Financial Accounting Standards Board (FASB) Governmental Accounting Standards Board (GASB) Financial Accounting Standards Advisory Council Governmental Accounting Standards Advisory Council

5. Select an answer Emerging Issues Task Force (EITF) Private Company Council (PCC) Financial Accounting Standards Board (FASB) Governmental Accounting Standards Board (GASB) Financial Accounting Standards Advisory Council Governmental Accounting Standards Advisory Council

6. Select an answer Emerging Issues Task Force (EITF) Private Company Council (PCC) Financial Accounting Standards Board (FASB) Governmental Accounting Standards Board (GASB) Financial Accounting Standards Advisory Council Governmental Accounting Standards Advisory Council

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FASB Seven-Step Process

FASB follows a seven-step standard setting process to issue a final standard. Select each step to review details. After reviewing details of each step, select Check Your Understanding.

Summary

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