Academic journal article Journal of Accountancy

FASB Report Helps Standard Setters Consider Future Events

Academic journal article Journal of Accountancy

FASB Report Helps Standard Setters Consider Future Events

Article excerpt

Accounting standard setters worldwide continue to face the questions of what should be the significance of future events in deciding whether items meet the definitions of assets and liabilities, whether and when they should be recognized and how they should be measured. To help them develop a common foundation on which to base accounting standards for their countries, the Financial Accounting Standards Board published a special report that explores both conceptual and technical issues. The report also discusses case studies that represent a cross section of situations involving future events.

"The problem of how to deal with future events is an ongoing one for the world's standard-setting bodies, said L. Todd Johnson, FASB research manager and principal author of the report. "Since they face similar problems, if they had similar tools they could come up with similar answers." The report aims to help the groups develop those tools. Although Johnson does not expect uniform standards any time soon, "having standard setters in various countries using the same conceptual frame work would further the internationalization of accounting standards."

Future Events: A Conceptual Study of Their Significance for Recognition and Measurement was originally presented at a November 1993 conference of international accounting standard-setting bodies attended by representatives from 21 countries. It is based on a study by the FASB, the International Accounting Standards Committee and the accounting standards boards of Australia, Canada and the United Kingdom and is the first joint effort involving these five bodies. …

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