Overview of US GAAP
What does generally accepted accounting principles (GAAP) address?
Recognition, measurement, and disclosure
What is the American Institute of Certified Public Accountants (AICPA)?
The AICPA is the professional organization for participating CPAs.
What is the role of the Financial Accounting Foundation (FAF)?
The FAF exercises oversight of the Financial Accounting Standards Board (FASB), appoints the members of the FASB, and ensures funding.
What is the role of the Financial Accounting Advisory Council (FASAC)?
The FASAC provides guidance on major policy issues, project priorities, and the formation of task forces.
What purpose does the Financial Accounting Standards Board (FASB) Accounting Standards Codification serve?
The FASB Accounting Standards Codification is the compilation of authoritative U.S. generally accepted accounting principles for nongovernmental entities.
What is the Financial Accounting Standards Board (FASB)?
The FASB establishes financial accounting standards for business entities.
What body developed generally accepted accounting principles (GAAP)?
The Financial Accounting Standards Board (FASB)
What comprises United States generally accepted accounting principles (GAAP)?
The Financial Accounting Standards Board (FASB) Accounting Standards Codification comprise authoritative U.S. GAAP for publicly traded companies. Securities and Exchange Commission (SEC) pronouncements are also GAAP for publicly traded entities.
What is the highest structure of the Financial Accounting Standards Board (FASB) Accounting Standards Codification?
The highest structure is areas.
What is the lowest structure of the Financial Accounting Standards Board (FASB) Accounting Standards Codification?
The lowest structure is paragraphs.
What is the main purpose of the Securities and Exchange Commission (SEC)?
The main purpose of the SEC is to promote efficient allocation of capital by maintaining open, orderly, and fair securities markets.
How are changes to the Financial Accounting Standards Board (FASB) Accounting Standards Codification accomplished?
Through Accounting Standards Updates (ASU)
What is the reason for the Financial Accounting Standards Board (FASB) Accounting Standards Codification?
To put all accounting guidance in one place
How do user groups influence the outcome of the Financial Accounting Standards Board (FASB) standards?
Users influence standards by providing input during the due process procedure.
What are the first three steps the Financial Accounting Standards Board (FASB) uses when issuing a new accounting standard?
1- Considers whether to add a project to its agenda in consultation with the Financial Accounting Foundation (FAF). 2- Conducts research. 3- Holds a public hearing on the topic.
What are the final three steps in the standard-setting process?
1- Evaluate research and comments from interested parties and issue an exposure draft. 2- Solicit additional comments. 3- Finalize new accounting guidance and issue Accounting Standards Updates (ASUs).
When are expenses recognized under accrual accounting?
Expenses are recognized when incurred, regardless of the period of cash payment.
What are the major areas in the Financial Accounting Standards Board (FASB) Accounting Standards Codification?
General principles 100 Presentation 200 Assets 300 Liabilities 400 Equity 500 Revenue 600 Expenses 700 Broad transactions 800 Industry 900
What are the seven key components of the general-purpose external financial report?
Income statement Balance sheet Statement of cash flows Statement of retained earnings Statement of comprehensive income Footnote disclosures Auditor's opinion
What does the Securities and Exchange Commission (SEC) do?
It administers the U.S. securities laws, most notably the Securities Act of 1933 and the Securities Exchange Act of 1934 as well as others.
What topics does the Financial Accounting Standards Board (FASB) Accounting Standards Codification not include?
Other comprehensive basis of accounting Cash basis Income tax basis Regulatory accounting principles
