Assignment 1-2 Professional Accounting Organizations

Assignment 1-2 Professional Accounting Organizations - GASB...

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The Governmental Accounting Standards Board (GASB) is an independent organization that establishes and improves standards of accounting and financial reporting for U.S. state and local governments. GASB was established in 1984 by an agreement of the Financial Accounting Foundation (FAF) and 10 national associations of state and local government officials. The GASB is recognized by governments, the accounting industry, and the capital markets as the official source of generally accepted accounting principles (GAAP) for STATE and LOCAL governments! Accounting and financial reporting standards designed for the government environment are needed because governments are different from for profit businesses. Also, the information needs of the users of government financial statements are different from the needs of the users of private company financial statements. (GASB.Org, 2011)
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Unformatted text preview: GASB is not a government entity; instead, it is an operating component of the FAF, which is a private sector not-for-profit entity. The standards of GASB are not federal laws or regulations and they do not have to be enforced, but compliance with GASBs standards, however, is enforced through the laws of some individual states and through the audit process, when auditors render opinions on the fairness of financial statement presentations in conformity with GAAP. (GASB, 2011) GASBs mission is to establish and improve standards of state and local governmental accounting and financial reporting that will: 1.Result in useful information for users of financial reports, and 2. Guide and educate the public, including issuers, auditors, and users of those financial reports. (GASB, 2011)...
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