The Financial Accounting Standards Board’s reason for being is to establish generally accepted accounting principles (GAAP). Some parties erroneously believe that phrase means that accounting rules must be supported by at least a majority of the Board’s constituents. Rather, the phrase refers to standards that are promulgated following an extensive due process within an overall conceptual framework of good accounting. And for its 30-plus years of existence the FASB has consistently taken a leadership position in issuing new standards that result in the most meaningful financial reporting, rather than succumbing to the temptation to issue only “popular” standards.
