It was created by the American Institute of Certified Public Accountants in 1959 and issued pronouncements on accounting principles until 1973, when it was replaced by the Financial Accounting Standards Board (FASB). The Accounting Principles Board ( APB) is the former authoritative body of the American Institute of Certified Public Accountants (AICPA). 605-40-25-1 is Revenue Recognition, Gains and Losses, Recognition, first paragraph.Former authoritative body of the American Institute of Certified Public Accountants Transition and Open Effective Date Informationįor instance, 210-10-20 is Balance Sheet, Overall, Glossary. Implementation Guidance and Illustrations Section numbers are standardized across topics (not all subtopics have all sections): The codification is used by accounting and reporting professionals, analysts and investors.Įach ASC reference is structured as a series of four numbers separated by hyphens: a three-digit Topic (the first digit of which represents an Area), a two-digit Subtopic, a two-digit Section, and a two- or three-digit Paragraph. Discounts may apply to multiple concurrent users. The professional view requires an annual subscription up to $940 depending on concurrent users. The codification allows a free basic view or paid professional view to the public. Public access to codification Īll users must register to view any codification information. The project was approved in September 2004 by the Trustees of the Financial Accounting Foundation. GAAP standards, and the FASB responded by launching a new project to codify the standards. The Financial Accounting Standards Advisory Council then voiced its concerns due to the increase of financial reporting guidance from the old U.S. Problems with the old standards increased financial reporting risk and led to inefficiencies that increased cost. GAAP were difficult to interpret, and the complexity of the standards made it hard for users to stay up to date. GAAP consisted of thousands of standards with multiple standard setters. Leading up to the codification process īefore the Codification, accounting standards lacked a consistent and logical structure. GAAP as of July 1, 2009, and to create a codification research system that is up-to-date for the released results of standard-setting activity." The codification was made to make accounting standards easier to find through a single database. GAAP in one spot, ensure that the codification content accurately represented authoritative U.S. The three primary goals of the codification are "simplify user access by codifying all authoritative U.S. The FASB expected the system to reduce the amount of time and effort required to research accounting issues, mitigate the risk of noncompliance with standards through improved usability of the literature, provide accurate information with real-time updates as new standards are released, and assist the FASB with the research efforts required during the standard-setting process. The Codification did not change GAAP, but it introduced a new structure, organized in an easily accessible, user-friendly online research system. To prepare constituents for the change, the FASB provided a number of tools and training resources. Securities and Exchange Commission (SEC) guidance that follows the same topical structure in separate sections in the Codification. GAAP pronouncements into roughly 90 accounting topics and displays all topics using a consistent structure. The Codification reorganizes the thousands of U.S. Accounting literature not included in the Codification is non-authoritative. 168, The FASB Accounting Standards Codification and the Hierarchy of Generally Accepted Accounting Principles. All prior accounting standards documents were superseded as described in FASB Statement No. The codification is effective for interim and annual periods ending after September 15, 2009. It is maintained by the Financial Accounting Standards Board (FASB).įASB accounting standards codification In US accounting practices, the Accounting Standards Codification ( ASC) is the current single source of United States Generally Accepted Accounting Principles (GAAP).
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