Reporting Requirements between FASB and GASB



Abstract

The research papers are focused on the differences and similarities between the GASB accounting framework and FASB accounting framework. How pensions are recorded under both the frameworks has been the main finding of this research paper. Also the benefits of different approaches to users of these statements have been discussed briefly.

Compare and Contrast Reporting Requirements between FASB and GASB

Introduction

GASB sets accounting standards for federal and local government companies and the FASB sets the accounting rules for the private sector entities whether they are profit or nonprofit organizations. GASB and FASB are two distinct boards that set accounting standards. Government Accounting Standards Board was found in 1984, its mission is to ensure that the government institutions and its related authorities provide relevant and useful information to the users of their financial statements. FASB stands for Financial Auditing Standards Board and was founded in 1973 in the US and sets standards and guidelines regarding the use of financial information in private profit and not for profit organizations (FASB, 2013).

Discussion

The FASB is not a government organization. It is related to Securities Exchange Commission and the Financial Accounting Foundation (FAF). It works along with international accounting bodies such as IASB so that the financial reporting documents used in the organizations of US are acceptable and understandable all over the world. It is responsible for developing and interpreting GAAP (Generally Acceptable Accounting Practices) in the US. Its mission is to provide the users, mostly the investors and general public transparent information that will aid them in making decisions by creating high quality accounting and reporting standards (FASB, 2013).

GASB sets accounting standards for the federal and local government companies. The (FASB) on the other hand sets accounting standards to be applied in the private sector accounting. FASB's main purpose is to make the accounting standards in such a way that investors and other stakeholders who are associated to the private sector can easily make and take decisions. GASB's main purpose is to make the government organizations accountable for the money they receive from the public and tax payers (GASB, 2013).

The GASB requires that the statement of net assets present current assets separately from non-current assets and current liabilities separately from the non-current liabilities. Under FASB this balance sheet is called as statement of financial position and it permits this kind of classification. GASB requirements are to ...