Model company goes online.

FauxCom, Inc., established in 1994, has proved itself a remarkably long-lived company considering it never existed. The AICPA special committee on financial reporting (the Jenkins committee) "founded" it to illustrate some of the issues in its comprehensive report, Improving Business Reporting A Customer Focus. The committee created FauxCom's annual report and an auditor's report to cover all of it.

Since the publication of the Jenkins committee's report, Internet use has exploded. Many public companies have posted financial data on Web sites and have added special features--such as financials that can be downloaded into spreadsheets--that go beyond what mere paper statements can offer. This prompted the FASB--now under Jenkins' leadership--to post the FauxCom information online, and visitors to the site now have access to all the information that was in the comprehensive report, with the addition of hypertext and download features.

The FASB's goal in creating a Web site for FauxCom, as if it were a real company, is to invite comments on the Internet's role in business information reporting. The FASB is especially interested in hearing from financial report users, according to Wayne S. Upton, Jr., a FASB senior project manager. "It struck us that we might get a lot more feedback if we said, `What about this?' rather than `Here's what everyone else is doing--what do you think about it?"' Upton told the Journal. Upton said that a user interested in inventory, for example, can start at the balance sheet and link to note disclosures on accounting policies, inventories and valuation allowances.

Upton has provided an explanatory article to accompany the FauxCom Web site, in which he says the FASB staff encourages companies to experiment with the techniques the FauxCom site illustrates. "We really want to get a conversation started," he said. The site includes a reply form.

Financial report users and others can view FauxCom on the FASB site at www.fasb.org. Upton's explanatory article also appears in the FASB Status Report, no. 299. Upton said the FauxCom site had an open comment period and that the FASB may update it from time to time.