Friday, December 16, 2011

FIVE NATIONAL FINANCIAL ACCOUNTING SYSTEMS

United States
Accounting in the United States is controlled by a private-sector body (the Monetary Accounting Standards Board, or even FASB), but a governmental company (the Securities and Trade Commission, or SEC) supports the authority of its requirements. The key link allowing this particular shared-power system to work effectively may be the 1973 SEC Accounting Sequence Release (ASR) No. 150.
This release states:
The Commission intends to continue its policy of looking to the private sector for leadership in establishing and improving accounting principles. For purposes of this policy, principles, standards, and practices promulgated by the FASB in its statements and interpretations, will be considered by the Commission as having substantial authoritative support, and those contrary to such FASB promulgations will be considered to have no such support. Until 2002, the United states Institute of Certified Public Accountants (AICPA), an additional private-sector body, set auditing standards. For the reason that year, the Public Company Sales Oversight Board (PCAOB) was set up, with broad powers to manage audits and auditors of public businesses. The PCAOB, discussed later, is really a private organization overseen through the SEC.

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