FASB

Financial Accounting Standards Board

Abstract

In this study we try to explore the organization named as Financial Accounting Standards Board in a holistic context. The main focus of the research is on Financial Accounting Standards Board and the issues that are faced by the organization related to the standards of finance and accounting used in the organizational practices. In addition, the research also focuses of the historic background of the organization and the background of its inception. The research also analyzes many aspects of the issues and tries to gauge their effect on FASB. Finally the research describes various suggestion and recommendations that can be implemented by FASB in order to successfully cope with the issues by formulating effective strategies.

Financial Accounting Standards Board

Introduction

The purpose of this paper is to enlighten the organization named as The Financial Accounting Standards Board (FASB). This paper aims to explore the historical background of the organization, the current position of FASB and the issues that are faced by FASB. In addition, the purpose of this paper is to suggest effective tactics through which the issues of FASB can be resolved. The Financial Accounting Standards Board (FASB) came into existence in the year 1973; the existence of FASB was realized by the replacement of the Committee of Accounting Principles. In addition, the origin of FASB was also assisted by the Committee of Accounting Procedure pertaining to the American Institute of Certified Public Accountants (Kirkegaard, 1997). The Financial Accounting Standard Board also known as FASB is an organization that focuses on improvement of the financial standards and focuses on the effective financial reporting related to the transactions. This organization was established in United States and the by nature it is a nonprofit organization; the main purpose of FASB is to formulate efficient accounting principles that are in harmony with the public interest (Kirkegaard, 1997).

FASB has been designated as the body that is authorized to set accounting standards for listed companies in the United States; this authorization has been provided by the Securities and Exchange Commission. The standards of accounting are necessary to the proper and effective performance of the country as the financial transactions are a significant part of the country's economy that can unsure its development. The decisions about resource allocation the decisions related to the investments are dependent on the credible, concise, transparent and understandable financial methodologies (Kirkegaard, 1997). Several decisions of organizations are based on the financial information about the operations and financial position of individual entities involved in the process.

The framework followed by FASB helps the organization to establish reasonable limits in order to judge the process of preparing financial and accounting information; in addition, FASB also focuses to increase understanding and trust of the users of a particular information (accounting and financial). The FASB is concerned with developing concepts of accounting and comprehensive financial reporting standards, and provides a guide for their implementation. The ideologies followed by FASB help the organization to establish standards and provide a conceptual framework to solve the financial and accounting ...