The Securities and Exchange Commission (SEC) designated the FASB as the organization responsible for setting accounting standards for public companies in the U.S.
[7] In December 2019, FAF board of trustees announced that Richard Jones would succeed Russell Golden as FASB's chair when his term expired at the end of June 2020.
The selection process was amended as such in 2008 to reduce private sector influence on the Board of Trustees and its oversight of the FASB and GASB.
[11][12] Marshall Armstrong, then-president of the American Institute of Certified Public Accountants (AICPA), appointed a group of seven men (collectively called the Wheat Committee after its head Francis Wheat) in 1971 to examine the organization and operation of the Accounting Principles Board, in order to determine what adjustments were needed to facilitate more accurate and timely results and avoid governmental rule-making.
The FASB was conceived as a full-time body to insure that Board member deliberations encourage broad participation, objectively consider all stakeholder views, and are not influenced or directed by political/private interests.
[17] The FASB Conceptual Framework was established in 1973 as a comprehensible set of standards and rules intended to address and solve new emerging issues.
[20] In August 1994 the group released a special report, Future Events: A Conceptual Study of their Significance for Recognition and Measurement.
[23] The two groups met on September 18, 2002, in Norwalk, Connecticut, to sign a Memorandum of Understanding (MoU)[24] which "committed the boards to developing high-quality, compatible accounting standards with a common solution.
"[25][26] This MoU, which came to be known as the Norwalk Agreement, outlined plans to converge IFRS and U.S. GAAP into one set of high quality and compatible standards.
For ten years the FASB and IASB collaborated on a common objective not only to eliminate differences between IFRS and U.S. GAAP wherever possible, "but also to achieve convergence in accounting standards that stood the test of time.
"[25] The Sarbanes–Oxley Act of 2002 was signed into law on July 30, 2002, to protect stakeholders and investors by improving the dependability and precision of corporate financial disclosures.
[29] The FASB established the Investor Task Force (ITF) in 2005, which was an advisory resource that provided the Board with sector expertise and specific insights from the professional investment community on relevant accounting issues.
[34][35] Haddrill who was the only UK representative on the FCAG, is CEO of the Financial Reporting Council (FRC) in the United Kingdom and has a close interest in accounting standards.
[42] In the resulting 2012 report, the SEC Staff asserted that the IFRS standards were not sufficiently supported by U.S. capital market participants and lacked consistent implementation methods.
[44] In May 2015 the SEC acknowledged that "investors, auditors, regulators and standard-setters" in the United States did not support mandating International Financial Reporting Standards Foundation (IFRS) for all U.S. public companies.
Instead, the FASB participates in the Accounting Standards Advisory Forum, a global grouping of standard-setters, and monitors individual projects to seek comparability.
[50] The FASB updated this reporting standard with the goal of improving comparability, relevance and reliability of financial information.
Critics claim FASB changes to mark-to-market accounting were made to accommodate "banks with toxic assets on their books.
[56] Others say mark-to-market provides the most practical choice when valuing most assets, if there is understanding of the long-term effects, and obligation to a global position.
Supporters also argue that a single set of standards would give investors access to crucial information more quickly and increase opportunities for international investments, resulting in economic growth.
U.S. firms and other CPAs have been reluctant to adapt and learn a new accounting system, and believe that IFRS lacks guidance compared to the GAAP.