FASB

Ok first, say it aloud, people…Fazzzz Beeeee. Sounds way cooler than:

Financial
Accounting
Standards
Board

What is it? Well, it’s a private regulatory body that has given birth to myriad opinions on how things should be accounted for...with its favorite child being GAAP.

Remember GAAP?

Generally
Accepted
Accounting
Principles

So GAAP was the most famous creation of FASB, but hundreds of other little creations followed...in that the august group of seven members who run FASB realized 50 years ago that the world would look different half a century later.

Accounting standards would have to be flexible, almost in the same vague way the U.S. Constitution is written...so that when a customer buys an upgrade from the people who make Angry Birds in an app sold by Apple, but downloaded by Comcast, paid for with a Visa card, everyone would know with certainty who got paid what...and when.

The key idea behind FASB is that it is an adaptive group that changes with a quickly changing environment. If you want to think about it in a mathy way, they seek to be the derivative, not the curve itself...