FASB Codification Guide-2

Content in the sec sections is expected to change

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Unformatted text preview: tion users. The SEC Sections do not contain the entire population of SEC rules, regulations, interpretive releases, and staff guidance. For example, the Codification does not include all content related to matters outside the basic financial statements, such as Management ’s Discussion and Analysis (MD&A), or to auditing or independence matters. Content in the SEC Sections is expected to change over time in accordance with the SEC’s normal procedures for making changes to SEC rules, regulations, interpretive releases, and staff guidance. The SEC’s normal update procedures are not changed by the inclusion of SEC content in the Codification, and, accordingly, there may be delays between the release of the SEC’s changes and updates to the Codification. The Codification does not replace or affect guidance issued by the SEC or its staff for public companies in their filings with the SEC. Furthermore, the content labeled as SEC staff guidance does not constitute rules or interpretations of the SEC, nor does such guidance bear official Commission approval. Which Guidance Applies to Which Entities? Most nongovernmental entities that prepare financial statements are not regulated by the SEC. Some nongovernmental entities, however, are regulated by the SEC, usually because those entities previously issued securities (such as bonds or shares of stock) directly to the general public, or because the entities’ securities currently trade among the general public. In the United States, entities that are not regulated by the SEC are generally not subject to statutory financial-reporting requirements and generally have no obligation, unless required by lenders or others, to use financial accounting and reporting standards set by the FASB. Even so, many such entities choose to use the FASB’s standards as documented in the Codification. For nongovernmental U.S. entities that are not SEC registrants, the FASB is currently the sole setter of U.S. authoritative financial accounting and reporting standards, but nonpublic e...
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