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FASB issues proposal on GAAP hierarchy.

Moving toward its goals of enhancing the quality of financial accounting standards and the standard-setting process, the Financial Accounting Standards Board has published an exposure draft, The Hierarchy of Generally Accepted Accounting Principles. Comments are due June 27, 2005 (obtain the ED from www.fasb.org).

The GAAP hierarchy, which currently resides in the AICPA's Statement on Auditing Standards No. 69, The Meaning of Present Fairly in Conformity With Generally Accepted Accounting Principles (SAS No. 69), ranks the relative authority of accounting principles issued from multiple standard setters. Recently, the Securities and Exchange Commission reaffirmed the FASB as the designated private-sector standard setter for public companies and the FASB has implemented procedures to narrow the types of accounting principles that it issues. Further, the FASB's codification and retrieval project will integrate existing U.S. GAAP into a single authoritative retrievable source, thereby creating a single authoritative codification of GAAP. This proposed statement, in connection with those developments and efforts, is a step towards achieving the ultimate vision for simplification of standard setting: one process and one form of guidance.

The exposure draft carries forward the GAAP hierarchy as set forth in SAS No. 69, subject to certain modifications that are not expected to result in a change in current practice.
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Title Annotation:accounting & auditing news; Financial Accounting Standards Board; Generally Accepted Accounting Principles
Publication:CPA Letter
Article Type:Brief Article
Geographic Code:1USA
Date:Jun 1, 2005
Words:210
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