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FASB chair remarks on the future of GAAP

  • Speech — dark blue Image

Oct 29, 2013

At the October 28, 2013, meeting of the National Association of State Boards of Accountancy, FASB Chairman Russell Golden gave his views regarding the FASB’s responsibility to “preserve and evolve” GAAP standards and the responsibilities it has to its stakeholders.

Mr. Golden explained that the key principle of preserving GAAP while ensuring that it evolves is “to find common ground while recognizing that in some cases, we may need to maintain some differences.” He stated that the goal of the international standard-setting process is to develop converged standards, but  acknowledged that jurisdictions may have different needs due to national regulatory laws or business culture. For domestic standard setting, the FASB has to identify the different needs of different types of companies.

Next, Mr. Golden discussed three areas the FASB will focus on to achieve its goal of improving financial reporting in the United States while also improving and converging international financial reporting:

  • Improvements to U.S. GAAP when necessary.
  • Participation in the development of IFRSs.
  • Cooperation with other national standard setters.

Lastly, Mr. Golden noted the work done by the FASB domestically. Concerning private companies, he mentioned the progress made by the Private Company Council (PCC), including the PCC’s advisory role on FASB projects and in the development of proposed alternative GAAP for accounting for interest rate swaps and goodwill for private companies. Also, he noted that the FASB is working on a disclosure framework project that will improve the effectiveness of disclosures in notes to financial statements by communicating information that is most important to users of financial statements.

Full text of the speech is available on the FASB's Web site.

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