GASB Proposes Adding Pre-1990 FASB, AICPA Guidance Into Codification

GASB issued an exposure draft of a proposed statement, Codification of Accounting and Financial Reporting Guidance Contained in Pre-November 30, 1989 FASB and AICPA Pronouncements. The proposed statement is intended to enhance the usefulness of GASB’s Codification by incorporating guidance that previously could only be found in certain FASB and AICPA pronouncements. This literature has not been maintained for the state and local government environment. By incorporating and maintaining this guidance in one source, GASB believes it will reduce the complexity of locating and using authoritative literature needed to prepare state and local government financial reports.

The proposed statement would incorporate into GASB’s authoritative literature the applicable guidance previously presented in the following pronouncements issued before Nov. 30, 1989:

1. FASB statements and interpretations;
2. Accounting Principles Board opinions; and
3. Accounting research bulletins of the AICPA’s Committee on Accounting Procedure.

GASB says the proposed statement would improve financial reporting by eliminating the need for financial statement preparers and auditors to determine which FASB and AICPA pronouncement provisions apply to state and local governments, thereby resulting in a more consistent application of relevant guidance in financial statements of state and local governments. It would also contribute to GASB’s efforts to codify all sources of GAAP for state and local governments so that they can be found within one source.

Comments are due July 31, 2010.