By doing so, we will continue to strive in the eyes of our investors thus creating a "win/win" situation for all parties involved.
Introduction.
To ensure that publicly corporations withhold the highest of standards, the Securities Exchange Commission (SEC) appointed the Financial Accounting Standards Board (FASB) as the organization responsible for establishing the standards for the financial reporting of non-government entities in the United States. .
FASB's mission is "to establish and improve standards of financial accounting and reporting for the guidance and education of the public, including issuers, auditors, and users of financial information" ("Facts about fasb," 2007). In order to achieve the mission, the following goals have been set in place: .
1. Improve the usefulness of financial reporting by focusing on the primary characteristics of relevance and reliability and on the .
qualities of comparability and consistency.
2. Keep standards current to reflect changes in methods of doing business and in the economy.
3. Consider promptly any significant areas of deficiency in financial reporting that might be improved through standard setting.
4. Promote international convergence of accounting standards concurrent with improving the quality of financial reporting.
5. Improve common understanding of the nature and purposes of information in financial reports. .
FASB ensures that all financial documents of a public entity are clear and concise so that stakeholders understand thoroughly how the company is doing and to monitor their investment (Elebash & Fahnestock, 1991). Also other mandatory rules and regulations are established in order to keep the public corporation entirely independent of its client to prevent any biased judgment when making decisions on their behalf.
This report was composed upon the request of the Executive Management Team to explain the history behind FASB, the impact it has on public corporations and the investment community, and how the entity directly affects Parker & Associates, LLP.
