key term - Financial Accounting Standards Board (FASB)

Definition

The Financial Accounting Standards Board (FASB) is an independent nonprofit organization responsible for establishing accounting and financial reporting standards in the United States. These standards are known as Generally Accepted Accounting Principles (GAAP).

5 Must Know Facts For Your Next Test

1. FASB was established in 1973 to develop and improve financial accounting standards.
2. FASB operates under the oversight of the Financial Accounting Foundation (FAF).
3. The FASB issues Statements of Financial Accounting Standards, which become part of GAAP.
4. FASB's mission is to ensure that financial reporting provides useful information to investors and other users.
5. The FASB collaborates with international standard-setting bodies like the International Accounting Standards Board (IASB).

Review Questions

Related terms

GAAP:

Generally Accepted Accounting Principles are standardized guidelines for accounting and financial reporting.

IASB:

The International Accounting Standards Board sets global accounting standards known as IFRS.

FAF: The Financial Accounting Foundation oversees FASB and ensures its independence and proper functioning.