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Financial Accounting Foundation.
401 Merritt 7, P.O. Box 5116, Norwalk, CT 06856-5116 _ 203-847-0700 FAX: 203-849-9714
The Role of Local Governments in Ensuring the Financial Viability of the GASB
In the world of Enron, WorldCom, and other corporate scandals, the need for transparent and credible financial reporting has received more attention than at any time in recent history. Transparent and credible financial reporting is the primary end result of strong accounting standards.
Since its inception in 1984, the Governmental Accounting Standards Board (GASB) along with the Financial Accounting Foundation (FAF), under whose umbrella the GASB functions, have been mindful of two key operational issues: (1) independence from federal government control and (2) adequate resources to fulfill the GASB's mission.
With the recent passage of the Sarbanes-Oxley Act of 2002, the Financial Accounting Standards Board (FASB), which is also under the FAF umbrella, will now be funded through a mandatory assessment levied on all U.S. companies registered with the Securities and Exchange Commission (SEC).
Can the GASB have both independence and a stable funding structure?
The GASB currently remains apart from this mandatory funding, which is good news for protecting its independence from federal government influence but bad news for ensuring adequate financial resources. The corporations that in the past financially supported the FASB and the GASB combined through the FAF will begin receiving an annual invoice assessing them for funding the FASB and the new Public Company Accounting Oversight Board as legislated by the Sarbanes-Oxley Act. This is likely to make it very difficult to generate any meaningful voluntary financial support from this group for the GASB. Prior to passage of the Sarbanes-Oxley Act, support from corporations represented the third-largest source of direct contributions to the GASB. In addition, with changes in the public accounting profession, contributions from this constituency dropped nearly $100,000 in 2002, and state contributions will likely also be down in 2003 and 2004.
- GASB Plans to Issue Accounting Guidance on Tobacco Bonds.
- Magazine article from: The Bond Buyer Hume, Lynn May 21, 2003 700+ words
...already exist. Meanwhile, GASB officials told GFOA...because the Sarbanes-Oxley Act has dried up corporate...that were used to fund GASB. The shortfall has forced...fact that the Sarbanes-Oxley Act imposed mandatory fees...money had been used for GASB's budget. Contributions...
- GFOA Urges GASB to Give More Info on Budget, Strategic Plans.
- Magazine article from: The Bond Buyer Hume, Lynn June 16, 2004 700+ words
...or Congress provides funds to GASB, they will want some say in...standards for governments. GASB had a deficit of more than...partly because the Sarbanes-Oxley Act dried up accounting firm contributions...organization that oversees both GASB and the Financial Accounting...
- GASB Budget Woes, Fear of SEC, Behind NASACT's Bond-Fee Idea.
- Magazine article from: The Bond Buyer Hume, Lynn June 27, 2003 700+ words
...organization that oversees both GASB and the private-sector Financial...GFOA's executive board that GASB has a shortfall of about $450...enactment of the Sarbanes-Oxley Act, which bars FASB from collecting...businesses. Historically, GASB has obtained about 40% of the...
- Bridging the GASB Gap: Issuer Groups, FAF Work to Develop Proposal.
- Magazine article from: The Bond Buyer Hume, Lynn July 18, 2003 700+ words
...agree on is that an independent GASB is in everyone's best interest...Krolicki's remarks come as GASB is facing a $450,000 shortfall...partly because the Sarbanes-Oxley Act has wiped out contributions...to the board. Fearful that GASB's budget shortfall could lead...
- GFOA Wants to Put GASB Out of Business: Says FASB Should Do Government...
- Magazine article from: The Bond Buyer Hume, Lynn March 16, 2007 700+ words
...detailed its complaints against GASB and its position in a set of...accounting standards for them. GASB standards are nonbinding on...Foundation, the group that oversees GASB and FASB, to set up formal...provisions of the Sarbanes-Oxley Act that require the SEC to provide...
- Revised Bond FeePlan Floated: Would Compensate For GASB Shortfall.
- Magazine article from: The Bond Buyer Hume, Lynn September 8, 2003 700+ words
...Ellsworth said. Historically, GASB has obtained about 40% of its...and businesses, according to GASB officials. The board ended...prohibitions in the Sarbanes-Oxley Act. That act imposed mandatory...some of those had been used for GASB. In addition, the states...
- SEC calls for more support for GASB.(United States. Securities and Exchange...
- Magazine article from: Accounting Today Cheney, Glenn August 20, 2007 700+ words
...provide an independent funding mechanism for GASB." He also called for legislation that would permit the SEC to oversee GASB, just as the Sarbanes-Oxley Act permits the commission to oversee GASB's sister board, the Financial Accounting...
- GASB Faces $1.9M Deficit Partly Due to Low Bond-Fee Payments.
- News wire article from: The America's Intelligence Wire May 10, 2006 700+ words
...voluntarily pay to help fund GASB's budget. The Bond Market...he said. Robert Attmore, GASB's chairman, who was also...enactment of the federal Sarbanes-Oxley Act, which effectively dried up...The foundation oversees both GASB and the Financial Accounting...
- Groups Tentatively Agree on New Bond Fee, Audit Fee for GASB.
- Magazine article from: The Bond Buyer Hume, Lynn November 20, 2003 700+ words
...local governments. Although GASB's guidance is not binding...annual financial statements. GASB was faced with a gap of about...partly because the Sarbanes-Oxley Act dried up corporate contributions...the organization that oversees GASB and the Financial Accounting...
- NASACT Asks TBMA to Collect Bond Fees From States for GASB.
- Magazine article from: The Bond Buyer Hume, Lynn July 1, 2003 700+ words
...a new bond fee to eliminate GASB's budget shortfall and stabilize...standards-setting board. GASB has a shortfall of about $450...partly because the Sarbanes-Oxley Act has wiped out contributions...provided about $1 million for GASB, based on a 1984 formula that...
Source: HighBeam Research, Financial Accounting Foundation.