Weaknesses of CAP

• Part-time committee members

• Lack of independence

• Not explicitly recognized by SEC

• Lack of full-time professional staff

Weaknesses of CAP (cont.)

• Pragmatic approach

• Lack of conceptual framework

• No comprehensive statement of accounting principles

• Inconsistency (e.g., ARB 44 & ARB 44 Rev.)

• No research division

Weaknesses of APB

• Part-time Board members

• Lack of independence

• Not explicitly recognized by SEC

• Inadequate full-time professional staff

Weaknesses of APB (cont.)

• Investment tax fiasco

• Pragmatic approach

• Lack of conceptual framework

• No comprehensive statement of accounting principles

FASB 1973-????

• Trueblood & Wheat Commissions

• 7 full-time board members

• Operational July 1973

• Independent

• Full-time staff

• Explicitly recognized by SEC (ASR 150)

• Rule 203 acknowledgement

• Conceptual framework

Pronouncements of FASB

Rule 203 Category A:

• FASB Statements

• FASB Interpretations

Other Pronouncements Issued by or Associated with FASB

• FASB Statements of Financial Accounting Concepts

• FASB Technical Bulletins

• EITF Abstracts

• FASB Staff Positions

• FASB Staff Q&As

FASB Codification - 2009

• In 2009 the FASB codified all U.S. GAAP for non-governmental entities into one location

• The only authoritative U.S. GAAP is the FASB Codification