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FASB Accounting Standards Codification Research Paper

887 Words4 Pages

FASB Accounting Standards Codification Project The FASB Accounting Standards Codification is the source of the authoritative generally accepted accounting principles, which is GAAP, recognized by the FASB to be applied to nongovernmental entities. The Codification is the result of a major 5 years project, including more than 200 people from multiple entities. The FASB developed a codification project which resulted in a key-word searchable data base of the authoritative literature for the US financial reporting. Rationale for the Project The Codification has been approved by FASB in June 2009 as the single official source for the US nongovernmental financial reporting. Then it went effective for the interim and annual periods ending on or after September of 2009. According to the FASB Accounting Standards Codification, about the Codification (v 4.9), the Codification has three primary goals as the rationale for the project. First of all, The Codification aims to simplify the access process for the users to all the authoritative US GAAP in one spot. It is the change from the standards-based model, involving thousands of individual standards, to the topics-based model. As the authorized codification, it covers all levels US GAAP …show more content…

Then it helps users mostly to have the benefit of the newest updated content. The codification structure is significantly different from the structure of the previous standards. The Codification continue to include the authoritative content issued by the SEC, as well as some selected SEC staff interpretations, which helps to improve the usability. Now, with the exception of any SEC or other grandfathered guidance, all other accounting literature not included in the Codification is deemed non-authoritative (based on the PowerPoint: source of DeVry/Becker Educational Development

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