Millsaps College


UNITED STATES ACCOUNTING & AUDITING STANDARDS
There are two major types of standards typically applied by accountants in the United States: accounting standards, including Generally Accepted Accounting Principles ("GAAP"), and auditing standards. Below we provide a brief overview, created by librarians at Georgetown Law Library, of the institutions that create GAAP in the United States.

In addition, the U.S. Securities & Exchange Commission ("SEC") publishes accounting guidance to help companies comply with the accounting requirements of the federal securities laws. The SEC also oversees the Public Company Accounting Oversight Board ("PCAOB"), a standards-making body created by the Sarbanes-Oxley Act of 2002, Pub. L. 107-204, 116 Stat. 745 (2002).


A. Generally Accepted Accounting Principles ("GAAP") for Non-Government Entities: The Accounting Standards Codification ("ASC")

GAAP are a set of accepted accounting procedures and rules used in the preparation of financial statements such as balance sheets, income statements, statements of owners' equity, and statements of cash flows. As of September 15, 2009, current GAAP for non-government entities are codified in the Accounting Standards Codification ("ASC") published by the Financial Accouting Standards Board ("FASB"). Auditing standards (as opposed to accounting standards) have not been affected by this codification. FASB is an independent private-sector organization created to establish and improve financial accounting and reporting standards.

FASB updates the ASC by issuing documents called Accounting Standards Updates. Accounting Standards Updates are available from:

See FASB's Notice to Constituents (v. 3.0, Oct. 2, 2009) for more information on the Accounting Standards Codification.

B. Historic and Grandfathered Accounting Standards for Non-Government Entities

A number of organizations, including but not limited to FASB, created accounting standards that have since been codified in FASB's Accounting Standards Codification. We provide brief profiles of those organizations and their standards below. Furthermore, some pre-ASC standards have been grandfathered, at least for limited purposes. For more information on grandfathered standards, see p. 9 of FASB's Notice to Constituents (v. 3.0, Oct. 2, 2009).

Financial Accounting Standards Board ("FASB")

FASB previously issued numerous pronouncements that contributed to GAAP, including but not limited to:

  • Statements of Financial Accounting Standards
  • FASB Interpretations
  • FASB Technical Bulletins
  • Statements of Financial Accounting Concepts

Historic FASB standards, as well as the current Accounting Standards Codfication, are available in:

  • In print at the library - Accounting standards HF5616.U5 A3.
American Institute of Certified Public Accountants ("AICPA")

According to its own web site "The American Institute of Certified Public Accountants is the national, professional organization for all Certified Public Accountants." (AICPA Mission Statement). Its Accounting Standards Executive Committee (AcSEC) determines the AICPA's policies on financial reporting standards and acts as the AICPA's voice on those policies. With an eye toward providing guidance to its members and influencing FASB and other standards-issuing bodies, AICPA's AcSEC issued the following types of pronouncements, among others:

  • Statements of Position
  • Audit and Accounting Guides
  • Practice Bulletins (approved by FASB)

Many AICPA accounting standards are available from:

AICPA continues to issue auditing standards, which are discussed below.

iii. AICPA Committee on Accounting Procedure ("CAP", 1936-1959) & Accounting Principles Board ("APB", 1962-1973) (both defunct)

Formerly part of the American Institute of Certified Public Accountants, the Committee on Accounting Procedure and its successor, the Accounting Principles Board, issued various standards including:

  • Accounting Research Bulletins (ARBs) - 1936 to 1959 (contained recommended accounting procedures not binding on AICPA members)
  • Opinions - 1959 to 1973
  • Statements - 1962 to 1970

The APB was dissolved in 1973 and no longer creates new standards. Those APB standards in effect on July 1, 2009 have been incorporated into FASB's Accounting Standards Codification.

C. Accounting Standards Applicable to Government Entities

For accounting by government entities such as federal, state, and local government agencies, additional accounting standards beyond those contained in the Accounting Standards Codification may apply. For state and local government entities, additional standards are promulgated by the Governmental Accounting Standards Board ("GASB"). For the federal government, additional standards are promulgated by the Federal Accounting Standards Advisory Board ("FASAB").

i. Governmental Accounting Standards Board ("GASB")

"The Governmental Accounting Standards Board was created in 1984 as an independent, professional body to establish standards of accounting and financial reporting applicable to state and local governmental entities. It was formed after agreement by the Financial Accounting Foundation, the American Institute of Certified Public Accountants, the Government Finance Officers Association, the National Association of State Auditors, Comptrollers and Treasurers, and the seven organizations representing state and local government officials," (GASB Facts).

GASB standards are GAAP for state and local governmental entities only. GASB issues the following types of pronouncements:

  • Concepts Statements (identify objectives and fundamental concepts that form the basis for establishing consistent financial reporting standards)
  • Statements (establish accounting standards)
  • Interpretations (of Statements)

GASB standards can be ordered directly from GASB.

ii. Federal Accounting Standards Advisory Board ("FASAB")

In October 1990, three officials responsible for federal financial reporting established the Federal Accounting Standards Advisory Board (FASAB or 'the Board') as a federal advisory committee. The officials were the Secretary of the Treasury, the Director of the Office of Management and Budget, and the Comptroller General of the United States. They created FASAB to develop accounting standards and principles for the United States Government." (FASAB Facts).

FASAB standards are GAAP for federal governmental entities only. FASAB issues the following types of pronouncements:

  • Statements of Federal Financial Accounting Concepts (provide general guidance to the FASAB as it deliberates on the creation or amendment of Statements of Federal Financial Accounting Standards)
  • Statements of Federal Financial Accounting Standards (contain specific authoritative requirements for financial reporting by federal government agencies)
  • Interpretations (clarify meanings of and provide definitions for reading Statements of Federal Financial Accounting Standards)
  • Technical Bulletins (provide guidance for applying FASAB Statements and Interpretations)
  • Technical Releases (provide guidance for applying accounting standards and on auditing issues)

FASAB standards are available in:

D. Auditing Standards

Auditing standards are guidelines applied by auditors in deciding whether financial statements have been prepared according to GAAP.

i. Auditing Standards Board, AICPA

Beginning in 1917, a committee of the American Institute of Certified Public Accountants, a professional organization of certified public accountants, was responsible for establishing auditing standards. The committee's name changed several times over the years. In 1978 it became the Auditing Standards Board. It issues the following types of pronouncements, among others:

ii. Public Company Accounting Oversight Board ("PCAOB")

In response to the Enron accounting scandal, the Sarbanes-Oxley Act of 2002, Pub. L. 107-204, 116 Stat. 745 (2002) created the Public Company Accounting Oversight Board (PCAOB) and gave it authority to establish auditing standards for public companies registered with the SEC. The 5 members of the PCAOB's Governing Board are appointed by the SEC and serve 5-year terms; no person may serve more than two terms. Two members must be or have been Certified Public Accountants ("CPAs") for at least 5 years prior to appointment. The other 3 members must not be or have been CPAs. PCAOB officially assumed its standards-making responsibility in 2003, but adopted AICPA auditing standards existing as of April 16, 2003 as interim auditing standards. PCAOB standards adopted after April 16, 2003 may supersede or amend AICPA auditing standards for audits of public companies.

Where to find PCAOB standards:

Securities & Exchange Commission ("SEC") Regulations, Guidance, and Enforcement Releases

The SEC issues guidance and regulations on the accounting methods to be used in financial statements that are filed with it by publicly traded companies pursuant to the federal securities laws. Instead of issuing standards itself, the SEC is primarily concerned with enforcing accounting and auditing standards in the context of financial statements it receives from public companies under the federal securities laws. It also oversees the Public Company Accounting Oversight Board. SEC regulations and guidance documents have not been superseded by FASB's Accounting Standards Codficiation. Accounting and auditing documents issued by the SEC include:

  • Regulation S-X (17 C.F.R. Part 210) (governs financial statement presentation and disclosure in SEC filings)
  • Staff Accounting Bulletins (SAB) (provide guidance on the SEC's views regarding the proper application of accounting standards in public company disclosures)
  • Accounting and Auditing Enforcement Releases (documents related to administrative enforcement proceedings the SEC initiates against persons who have allegedly violated accounting standards in financial statements submitted to the SEC under the federal securities laws)

Many SEC releases (including Accounting and Auditing Enforcement Releases) and all current SEC regulations are available in:

  • CCH Federal Securities Law Reporter [KF1068.4 .C58[58]].
  • CCH IntelliConnect (browse under "Securities (Federal)" for the Federal Securities Law Reporter).
International Accounting Standards

IV. INTERNATIONAL ACCOUNTING & AUDITING STANDARDS

International accounting and auditing standards are not binding in individual countries unless those countries' standards-setting bodies choose to make them so. However, the International Accounting Standards Board and International Federation of Accountants work with the standards-setting bodies of many nations, including the U.S., in order to promote the convergence of accounting and auditing standards worldwide. More than 90 countries now require the financial statements of publicly traded companies to be prepared in accordance with the IASB's International Financial Reporting Standards ("IFRSs"). (See the IASB FAQ.) Some countries, including the U.S. and Japan, do not permit companies to use IFRSs without reconciliation to domestic GAAP. (Id.)

A. International Accounting Standards Board ("IASB")

The IASB issues accounting standards in the form of pronouncements called International Financial Reporting Standards ("IFRSs") and Interpretations, both of which are available in the annual print publication International Financial Reporting Standards. Each annual volume contains the standards in effect as of January 1 of the year of issue. Millsaps library does not own this series of books, but can get it for you via interlibrary loan.

B. International Accounting Standards Committee ("IASC", defunct)

The IASC was the predecessor to the IASB. It issued pronouncements called International Accounting Standards, which are available in the print publication International Accounting Standards (coverage: annual volumes from 1991-2002 contain the standards in effect as of January 1 of the year of issue). Millsaps library does not own this series of books, but can get it for you via interlibrary loan.

C. International Federation of Accountants ("IFAC")

The IFAC issues auditing standards in the form of pronouncements called International Standards on Auditing. These standards are available in the annual publication Handbook of International Auditing, Assurance, and Ethics Pronouncements, which is available for download from the IFAC web site.

WHERE TO FIND STANDARDS
The table below provides references to accounting materials arranged in alphabetical order by common citation. Accounting standards that have been superseded by the FASB Accounting Standards Codification ("ASC") for interim and annual reporting periods after Sept. 15, 2009 are indicated by an asterisk (*). As discussed in the FASB Notice to Constituents, a few pre-ASC standards have been grandfathered.


Where to Find Accounting Standards When You Have a Citation
Citation Type of Standard Where to Find It
AAER SEC Accounting and Auditing Enforcement Release

(browse under "Securities (Federal)" for the Federal Securities Law Reporter)

 

AIN* AICPA Accounting Interpretation (issued prior to 1974)


APB* Accounting Principles Board Opinion (issued by the AICPA's Accounting Principles Board between 1962 & 1973)


APS* Accounting Principles Board Statement (issued by AICPA's Accounting Principles Board)


ARB* Accounting Research Bulletin (issued by the AICPA Committee on Accounting Procedure until 1959)


AS PCAOB Auditing Standard PCAOB Web Site
ASC (same as FASB ASC) FASB Accounting Standards Codification

FASB Accounting Standards Codification Basic View (Free registration required; browsable, but not searchable.)

AU Sections of the AICPA's Codification of Statements on Auditing Standards (codify AICPA original pronouncements on auditing, e.g., Statements on Auditing Standards)

AICPA Professional Standards [not available in the Millsaps  Library]

Some sections available on the AICPA web site

CON* Statement of Financial Accounting Concepts (issued by FASB)

FASB Web Site

Checkpoint (GULC faculty, staff, and students only; choose Practice Area "Accounting, Audit & Corporate Finance" to search.)

EITF Issue No. Emerging Issues Taskforce (FASB) Issue

Discussion materials & minutes (2004 - ): FASB Web Site

Abstracts (1984 - ): FASB Web Site

Discussion materials & minutes (pre-2004): Must be purchased individually from the FASB Order Dept., 203-847-0700 ext. 10.

FAS* (same as SFAS) Statement of Financial Accounting Standards (issued by FASB)

FASB Web Site

 

FASB ASC (same as ASC) FASB Accounting Standards Codification FASB Accounting Standards Codification Basic View (Free registration required; browsable, but not searchable.)
FIN* FASB Interpretation

FASB Web Site

FRR SEC Financial Reporting Release

 (browse under "Securities (Federal)" for the Federal Securities Law Reporter)

 

FTB* FASB Technical Bulletin

FASB Web Site

 

GAAS Generally Accepted Auditing Standards Refers to AU 150, a specific section of AICPA's Codification of Statements on Auditing Standards, the current version of which is available on the AICPA web site.
IAS International Accounting Standard (issued by the International Accounting Standards Committee until 2001. Superseded by International Financial Reporting Standards, below.) International Accounting Standards [not owned by Millsaps Library] (1991-2002)
IFRS International Financial Reporting Standard (issued by the International Accounting Standards Board from 2003 - ) IASB Web Site (free registration is required)
ISA International Standard on Auditing (issued by the International Federation of Accountants) Handbook of International Auditing, Assurance, and Ethics Pronouncements (available for download from the IFAC web site)
PCAOB-YEAR-## SEC release about a PCAOB rule proposal

SEC Web Site

PCAOB AS PCAOB Auditing Standard PCAOB Web Site
Regulation S-X SEC regulation governing financial statement presentation and disclosure in corporate filings 17 C.F.R. Part 210
SAB SEC Staff Accounting Bulletin

(browse under "Securities (Federal)" for the Federal Securities Law Reporter)

SEC Web Site (SAB 94 - ; April 18, 1995 - ; selected bulletins only)

 

SAS Statement on Auditing Standards (issued by the AICPA)

Original pronouncements must be purchased individually from the AICPA through its online store.

Selected codified versions available on the AICPA web site

SFAS* (same as FAS) Statement of Financial Accounting Standards (issued by FASB)

FASB Web Site

SFFAC Statement of Federal Financial Accounting Concepts (issued by the FASAB) SFFAC are included in the publication Pronouncements as Amended, which is available on the FASAB Web Site.
SFFAS Statement of Federal Financial Accounting Standards (issued by the FASAB) SFFAS are included in the publication Pronouncements as Amended, which is available on the FASAB Web Site.
SOP* Statement of Position (issued by AICPA)

Must be purchased individually from the AICPA through its online store.

Also available in the publication AICPA Technical Practice Aids, not available in the Georgetown Law Library.

Staff Acc. Bulletin Rel. No. (same as SAB) SEC Staff Accounting Bulletin

(browse under "Securities (Federal)" for the Federal Securities Law Reporter)

SEC Web Site (SAB 94 - ; April 18, 1995 - ; selected bulletins only)

 


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This guide created by Georgetown Law Library and edited by Millsaps Librarians. Current as of August 2011.