FASB’s parent organization, the Financial Accounting Foundation (FAF), announced in March it is forming a working group to review the adequacy and effectiveness of FASB’s efforts in setting standards for the private company and nonprofit sectors.
The creation of the working group follows the release earlier this year of a report by a blue-ribbon panel charged with examining the 30-year-old debate over private company accounting standards. The panel was sponsored by FAF, the AICPA and the National Association of State Boards of Accountancy. Among other recommendations, the report urged FAF to create a board separate from FASB that would set private company reporting standards.
FAF says the working group is the next phase of its review. The group intends to issue an action plan in six to eight months on whether or how to devise rules that differ from those of public companies, according to Christine Klimek, a FAF spokesperson.
The group will consist of FAF trustees and staff, Klimek said. It will conduct outreach to stakeholders through round-table meetings, surveys and meetings with advisory and constituent groups and others. In conjunction with obtaining input on the scope of the issues and concerns to be addressed, FAF will seek input on suggested improvements, including the solutions recommended by the blue-ribbon panel.
See videos of Institute and profession leaders explaining the blue-ribbon panel’s recommendations at aicpa.org/privateGAAP. For updated and archived news about the panel’s recommendations, visit journalofaccountancy.com/Web/BRP.htm.
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