Laux; Shiva Rajgopal; George Vrana. Summary: FASB organizes the discussion of these conditions: users of financial reports‚ primary use of financial statements- management and investment decisions‚ cash flow as the objective of financial reporting‚ limitations of external financial reporting‚ relevance and trustworthiness‚ auditing and trustworthy numbers‚ conservatism bias‚ balance-sheet and income-statement approach‚ and the function of the FASB/ IASB. For example‚ the use of financial statements
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Comprehensive Income: Presentation of Comprehensive Income was issued to increase the importance of items reported in other comprehensive income. The FASB‚ along with IASB‚ worked jointly to improve and converge the reporting and presentation requirements for items contained in other comprehensive income. At the same time FASB issued ASU 2011-05‚ IASB issued an amendment to IAS 1‚ Presentation of Financial Statements‚ which implemented the same reporting and presentation requirements as FASB’s new
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Users of financial accounting statements have both coinciding and conflicting needs for information of various types. 8. The Securities and Exchange Commission appointed the Committee on Accounting Procedure. 9. The passage of a new FASB Standards Statement requires the support of five of the seven board members. 10. Financial Accounting Concepts set forth fundamental objectives and concepts that are used in developing future standards of financial accounting and reporting.
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issue by the FASB rather than on the standards issued by the IASB. Unlike many countries‚ United States has not yet adopts the IFRS. Besides‚ the United States was very strong in its resolve not to adopt IFRS‚ believing that its ‘rule-based’ standards were superior to the more ‘principle-based’ standards of the IASB. Nevertheless‚ due to some corporate collapse such as Enron‚ FASB and IASB had entered a joint agreement to converge and improve the standards of both the IASB and FASB. Although there
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is to evaluate the project being conducted on financial accounting theory: Investment Property Entities. The FASB project serves as the mediator and as an attempt to resolve the differences being presented between U.S. GAAP and IFRS as it relates to operating leases. Historical Development The Federal Accounting Standards Board (FASB) and International Standards Board (IASB) issued a memorandum of understanding on October 29‚ 2002 confirming and formalizing their prior discussion to
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Standards Board (IASB) in 2001. The IASB is based in London and is the private sector standard setting body for non-government and not-for-profit entities. All fifteen members are selected based on technical skills and background from many different countries. At this time‚ four of the members are American. Two of the sitting members are always part-time. The IASB is primarily funded by fundraising activities. One of the challenges facing the conversion to IFRS is ensuring that the IASB has a stable
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The International Accounting Standards Board (IASB) and the Financial Accounting Standards Board (FASB) are undertaking the Conceptual Framework project jointly in order to create a sound foundation for the new accounting standard by revising the existing conceptual framework. The International Accounting Standards Board (IASB) is the dependent standard-setting body of the IFRS foundation. The IASB adopted the FASB in its framework as guidelines for the preparation IFRS that it published in 1989
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Revenue Recognition: IFRS and FASB Convergence With the growth of international business there is a need to standardize financial statements globally. Presently there are “approximately 120 foreign private issuers currently that report to the Commission using IFRS financial statements.” By standardizing accounting practices investors will be able to make informed decisions based on comparability and accuracy of financial statements. The SEC released this statement in 2008‚ “We believe that
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highly anticipated IFRS No 9 affects not only foreign accounting firms‚ but US Certified Public Accountants (CPAs) as well‚ due to globalization. The talk of convergence between the International Accounting Standards Board (IASB) and the Financial Accounting Standards Board (FASB) has been ongoing since 2002. Since 2002 there have been objections by accounting professionals opposing the convergence. At this point‚ the naysayers seem to be victorious. The total adoption of IFRS by the United States
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be legal within its borders. As a US born company‚ GM is held to these standards. The Standards include‚ GAAP‚ disclosures such as Sarbanes Oxley‚ and monitoring by the PCOAB. GAAP (Generally Accepted Accounting Principles) were established by the FASB‚ which has been given the authority to monitor and enforce these regulations. These regulations include consistency‚ relevance‚ reliability and comparability. To be consistent‚ all information gathered must be the same throughout all periods and have
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