Financial Accounting Standards Board (FASB)

The Financial Accounting Standards Board (FASB) is an independent, private-sector organization responsible for establishing and improving financial accounting and reporting standards in the United States. Founded in 1973, FASB's mission is to develop and uphold Generally Accepted Accounting Principles (GAAP), which are essential for ensuring transparency and consistency in financial reporting.

Key functions of FASB include:

• Developing GAAP: FASB sets and maintains GAAP to ensure that financial statements are comparable and reliable for investors, creditors, and other stakeholders.
• Improving Financial Reporting: The board works to improve the relevance, clarity, and utility of financial statements to meet evolving economic and regulatory requirements.
• Collaboration with International Bodies: FASB collaborates with the International Accounting Standards Board (IASB) to promote the convergence of U.S. GAAP and International Financial Reporting Standards (IFRS).

FASB's standards are recognized by the U.S. Securities and Exchange Commission (SEC) and are mandatory for publicly traded companies in the United States.

Source(s):

• Financial Accounting Standards Board (FASB). (n.d.). About the FASB.
• Financial Accounting Foundation (FAF). (2024). Overview of the FASB and FAF.

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