AcSEC Relinquishes Accounting Standard-Setting Role
The decision, which was made several weeks ago, was also announced by Financial Accounting Standards Board (FASB) Chairman Robert Herz at a conference of financial executives in New York. According to a report in the Wall Street Journal, Chairman Herz said, AcSEC will "cease issuing statements that create GAAP," referring to generally accepted accounting principles.
Apparently, the shift in AcSEC's role is seen as a way to streamline the accounting standard-setting process. Chairman Herz likened the current accounting rule-making process to a "four-legged stool" with decisions about GAAP being made by FASB, its Emerging Issues Task Force (EITF), AcSEC and the U.S. Securities and Exchange Commission (SEC).
In the new streamlined process, AcSEC will continue to be the technical committee authorized to speak on behalf of the AICPA regarding financial reporting matters. It will continue its work on industry-specific accounting and audit guides (A&A guides), consider ways to provide frequent updates to these guides via electronic communications, and continue to develop comment letters from AICPA to FASB and the International Accounting Standards Board on proposed new standards.
AICPA said in its statement that the decision was made to help achieve the "mutual goal of creating principles-based U.S. accounting standards" and that AICPA and FASB will work together on a transition.
Other new developments announced by Chairman Herz at the conference include plans for a greater involvement by FASB board members in the decisions made by EITF and the appointment of two new members from the investment community to EITF.