The Financial Accounting Foundation, or FAF, was borne out of the private sector. FAF is an independent organization that upholds the integrity of accounting. They mainly maintain accounting operating standards, but sometimes make improvements and upgrades, too.
FAF has two sub-branches it oversees: the Governmental Accounting Standards Board (GASB) and the Financial Accounting Standards Board (FASB). While GASP...er, GASB...is non-governmental, they're the leaders in governmental reporting standards for state and local governments through GAAP: Generally Accepted Accounting Principles. Generally. Meanwhile, FASB does the same, but for companies and nonprofits rather than for state and local governments.
Without the Financial Accounting Foundation and society’s adherence to it, the accounting world would be a lot more confusing. By creating standards that everyone adheres to, FAF has created a sort of accounting “language” that accountants can easily “read” across various companies. Thanks, FAF.
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Finance: What is FASB?9 Views
Finance a la shmoop what is FASB? ok first say it with me people FASB sounds
way cooler than Financial Accounting Standards Board alright well what is it
well it's a private regulatory body that has given birth to myriad opinions on [FASB definition appears on 100 dollar bill]
how things should be accounted for with its favorite child being GAAP.....
yeah, remember GAAP generally accepted accounting principles and it's the
religion of accounting 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 a
whole lot different half a century later when you were countin beans like who'd have
thunk about digital beans accounting standards would have to be flexible [People stretching in a field]
almost in the same vague way the US 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 while everyone would
know with certainty who got paid what when the key idea behind FASB is that
it's an adaptive group that changes with a quickly changing bean-counting
environment trying to make sure everything is you know fair and square
for all if you want to think about it in a mathy way well they seek to be the
derivative not the curve itself alright so you're living right here on the curve [Arrow points to derivative on a curve]
changing all the time dxdy and all that crap, FASB....
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GAAP is an acronym for Generally Accepted Accounting Practices. In order to remove as much subjectivity as possible, accounting policy bodies, such...