Gasb And Fasb Analysis Paper
GASB and FASB Analysis Paper
Mercedes Lugo
ACC 460
May 21, 2007
It has long been affirmed that in order to measure the success of any particular financial endeavor it must be standardized and quantified. To this end external bodies establish standards that provide a conceptual framework and guidance when assessing the organizations success or failure at any given point in time. The chief standard setting body for public financial accounting and reporting in the United States is the Financial Accounting Standards Board (FASB). FASB establishes and improves standards of private financial reporting for the benefit of the data's end user. These end users may take the form of potential investors, shareholders and creditors. However, due to the fact that governmental organizations must also prepare fiscal outlooks and financial reports the question then becomes how is the government's financial success or failure measured and who will set the guidelines for these measurements?
FASB answered this question by organizing the Governmental Accounting Standards Board (GASB) in 1984. GASB is considered FASB's counterpart in governmental accounting standards for both local and state agencies.
There are many similarities between FASB and GASB. As previously mentioned, both boards are given the authority to set standards regarding financial reporting that will result in useful information for the end user. Additionally, both organizations must guide and educate the public on how the standards affect the financial reports they rely on for pertinent financial data. Yet notwithstanding the abovementioned parallel goals, together they are entrusted with one of the most important functions encompassing the current accounting dynamic. Both the FASB and the GASB can establish GAAP or Generally Accepted Accounting Principles in equal standing. This regulatory power is a key point...
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