Private Sector vs Public Sector Accounting
PRIVATE SECTOR VS PUBLIC SECTOR
ACCOUNTING STANDARD
1. INTRODUCTION
The global financial crisis has demonstrated that the public sector as well as the private sector needs the highest quality accounting standards. Around the world, accounting in the public sector is practiced in diverse ways and struggles to achieve comparable standard in accountability and transparency.
The Securities Act of 1933 gave the commission the authority to prescribe accounting standards to be followed by the companies for the purpose of complying with federal securities laws. The Commission has historical looked to the privates sector to help establish those standard, creating an important joint responsibility. This joint responsibility has recently being subject of concern and comment, from both congress and the business community. The Commission exercises strong oversight in the standard setting process and must do so in the context of complex and challenging accounting issues, some of which are viewed as extremely important in today national and international business environment.
Since 1973, the Financial Accounting Standards Board (FASB) has been the designated organization in the private sector in the U.S. for establishing standards of financial accounting and reporting. Those standards govern the preparation of financial reports. They are officially recognized as authoritative by the Securities and Exchange Commission and the American Institute of Certified Public Accountants. Such standards are essential because donors, investors, creditors, auditors and others rely on credible, transparent and comparable financial information.
The mission of FASB is to establish and improve standards of financial accounting and reporting for the guidance and education of the public, including issuers, auditors and users of financial information. The FASB develops broad accounting concepts as well as standards for financial reporting. It also provides guidance on implementation of
ACCOUNTING STANDARD
1. INTRODUCTION
The global financial crisis has demonstrated that the public sector as well as the private sector needs the highest quality accounting standards. Around the world, accounting in the public sector is practiced in diverse ways and struggles to achieve comparable standard in accountability and transparency.
The Securities Act of 1933 gave the commission the authority to prescribe accounting standards to be followed by the companies for the purpose of complying with federal securities laws. The Commission has historical looked to the privates sector to help establish those standard, creating an important joint responsibility. This joint responsibility has recently being subject of concern and comment, from both congress and the business community. The Commission exercises strong oversight in the standard setting process and must do so in the context of complex and challenging accounting issues, some of which are viewed as extremely important in today national and international business environment.
Since 1973, the Financial Accounting Standards Board (FASB) has been the designated organization in the private sector in the U.S. for establishing standards of financial accounting and reporting. Those standards govern the preparation of financial reports. They are officially recognized as authoritative by the Securities and Exchange Commission and the American Institute of Certified Public Accountants. Such standards are essential because donors, investors, creditors, auditors and others rely on credible, transparent and comparable financial information.
The mission of FASB is to establish and improve standards of financial accounting and reporting for the guidance and education of the public, including issuers, auditors and users of financial information. The FASB develops broad accounting concepts as well as standards for financial reporting. It also provides guidance on implementation of