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Where do all these accounting rules come from?

By February 17, 2017News

One major role that a CPA could have in a company is to prepare the financial reports for a company. If the company you work for is publicly traded in the United States, you will have to follow what is called “SFAC” (Statement of Financial Accounting Concepts) when preparing the financial statements. But where did SFAC come from?

Rules surrounding SFAC and many other accounting concepts come from the Financial Accounting Standards Board, “a seven-member independent board consisting of accounting professionals who establish and communicate standards of financial accounting and reporting in the United States” (Investopedia). The rules generated by this board are adopted by the Securities and Exchange Commission to standardize how financial reporting takes place. Currently, the FASB is comprised of members with experience in many different sectors, including career accountants, former SEC employees, and academics who teach accounting.

Becoming part of the FASB is a long journey, but it can be very reassuring to know that the current members all started off taking CPA exams as well. Accounting can offer many different career paths and the ability to influence the entire field is definitely there.

 

Read more:

Financial Accounting Standards Board – FASB Definition | Investopedia

https://www.iasplus.com/en-us/resources/faf/fasb-board-membership

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