The Financial Accounting Foundation commemorated the 40th anniversary of the creation of the Governmental Accounting Standards Board in its annual report and also referenced the 50th anniversary last year of the Financial Accounting Standards Board.
The report, released Wednesday, offers an overview of the major milestones over the last 40 years of GASB and staff as they worked to develop and issue state and local accounting standards. The report is available as both a printable
"The standards the GASB has issued and improved over the past four decades have given financial statement users access to information they need to make decisions about governments' financial information and to assess their accountability," said GASB chair Joel Black in the report. "We are very proud of this work, which is the legacy of everyone who has served on our board and staff over our history. We look forward to commemorating this milestone over the course of 2024 with celebrations and other activities."
On Tuesday,
"We are excited to commemorate the work that's gone into 40 years of standard-setting from past board members and team members and all the stakeholders contributing to a full set of GAAP that we think works really well," said Black. "It took 40 years to create, but we're also taking the time to look at and think about how it's setting us up for the future, and making sure that we are prepared for the next 40 years of setting standards and dealing with maintaining GAAP and advancing it for what the future might look like."
The Financial Accounting Foundation also oversees the Financial Accounting Standards Board, which celebrated its 50th anniversary last year. FASB chair Richard Jones discussed the board's accomplishments over the past year and future plans in the report.
"The FASB was pleased to celebrate its 50th anniversary in 2023," Jones wrote. "This longevity is a testament to the benefits of the independent standard-setting process. It's a great asset that allows the FASB to solicit and incorporate diverse views to develop standards that provide our stakeholders with relevant, unbiased information in the most cost-effective way possible. It's also a great privilege because we must continually earn the right to set standards."
He noted that in 2023, FASB completed or made substantial progress on its agenda, including three priority areas raised during its agenda consultation: segment reporting, crypto assets, and income tax disclosures.
"The completion of these three projects — some of which have been on our agenda in one form or another for years — are a major accomplishment made possible by our stakeholders," Jones added. "Their input during the agenda consultation provided critical direction and achievable paths forward on these and other projects that we expect to reach due process milestones in 2024, including software costs, environmental credit programs, and government grants."
In 2023, he noted FASB continued to perform extensive outreach on its proposed standard on Disaggregation of Income Statement Expenses, including hosting a public roundtable last December where stakeholders shared feedback on the benefits and costs of providing investors with more detailed information about certain types of expenses, including employee compensation, inventory, depreciation and amortization.
Last year, FASB also issued final standards on joint venture formations and finalized a consensus of its Emerging Issues Task Force with a standard that improves the accounting and disclosures for investments in tax credit structures. Based on another EITF consensus, FASB proposed a standard to clarify requirements for determining whether certain settlements of convertible debt instruments, including convertible debt instruments with cash conversion features, should be accounted for as induced conversions.
FASB plans to discuss feedback on that proposal later this year. FASB also continued its post-implementation reviews of its revenue recognition, leases and credit losses standards, and based on what it heard from private company stakeholders, it finalized accounting guidance on lease arrangements between entities under common control to provide private companies and certain not-for-profit organizations with a practical expedient. FASB is also mulling the possibility of setting guidelines around the use of non-GAAP metrics, according to
FAF chair Edward Bernard and executive director John Auchincloss discussed some of the other accomplishments of the foundation over the past year. Early in the year, the FAF ended its subscription service and provided fully free access to FASB's Accounting Standards Codification and GASB's Governmental Accounting Research System, offering user-friendly enhancements formerly reserved for paying subscribers.
They also redesigned the websites of both FASB and GASB and began livestreaming portions of their oversight conversations with leaders of both boards. They created a new online system that stakeholders can use to register concerns directly with the FAF trustees about potential issues on the part of FASB or GASB in following their due process procedures. In addition, the FAF trustees kicked off their second review of the effectiveness of FASB's Private Company Council, the main advisory body to FASB on matters concerning private company financial reporting. They hope to complete this review project by the fourth quarter of 2024.
