Ethics in Accounting
The Financial Accounting Standards Board (FASB) has been working for ten years to bridge the gap between the United States’ Generally Accepted Accounting Principles (GAAP) and the International Accounting Standards Board (IASB). As part of this movement, Russell Golden, the chairman of the FASB, indicated that he would like to focus on making corporate disclosures more consistent. By doing so, it would be easier for investors to compare companies from different sectors. The FASB is “working on a framework to improve, coordinate, and possibly reduce the volume of corporate disclosures” (Chasan, 2013). This is decidedly important in an effort to remain relevant to the economy. Standardized accounting principles have been integral in economic and industrial advances, the inability to compare financial information led to the Great Depression. In the internet economy where access to financial information is readily available, comparable and relevant information is important for keeping capital costs down. Golden noted that while the FASB is striving to make the standards more consistent, they acknowledge that their ultimate priority are the users of GAAP financial statements.
The author’s position toward the theory issue seems to be a positive attitude toward the Convergence Project. She pointed out the importance that GAAP has played in our country’s economic development, but also noted that without consistent, relevant, and comparable financial statements, the entire system is left quite vulnerable. The author also quoted Golden saying that the FASB, while trying to minimize the inconsistencies between GAAP and IFRS, their priority is the GAAP users. This seems to support the findings of the American Accounting Association committee that noted that while both GAAP and IAS/IFRS boast high-quality accounting standards, GAAP seems to be preferred in the U.S (Schroeder, 2011).
This article relates to GAAP and the Conceptual Framework because the way financial data is
The author’s position toward the theory issue seems to be a positive attitude toward the Convergence Project. She pointed out the importance that GAAP has played in our country’s economic development, but also noted that without consistent, relevant, and comparable financial statements, the entire system is left quite vulnerable. The author also quoted Golden saying that the FASB, while trying to minimize the inconsistencies between GAAP and IFRS, their priority is the GAAP users. This seems to support the findings of the American Accounting Association committee that noted that while both GAAP and IAS/IFRS boast high-quality accounting standards, GAAP seems to be preferred in the U.S (Schroeder, 2011).
This article relates to GAAP and the Conceptual Framework because the way financial data is
References: Chasan, E. (2013, October 30). FASB Chairman Pushes for Consistency. Retrieved from The Wall Street Journal: http://blogs.wsj.com/cfo/2013/10/30/fasb-chairman-pushes-for-consistency/?KEYWORDS=accounting+standards Cheney, G. (2008). FASB, IASB present docs on framework. Accounting Today, 22(13), 14-14,16. Retrieved from http://search.proquest.com/docview/234368007?accountid=12085 Schroeder, R. C. (2011). Financial Accounting Theory and Analysis. Danvers: John Wiley and Sons, Inc.