The Government Accounting Standards Board Essay

713 Words 3 Pages

The Government Accounting Standards Board (GASB) established in 1984, is an independent organization that determines and improves generally accepted accounting principles (GAAP) for U.S. state and local government entities. However, GASB is not a government entity, it is an operating component of the Financial Accounting Foundation (FAF), a private sector not-for-profit entity (GASB, "Facts About GASB "). The accounting and financial reporting standards established by GASB are essential for government entities operate differently than for profit businesses. The Financial Accounting Standards Board (FASB) is another board that establishes GAAP pertaining to private sector accounting. Both GASB and FASB focus to ensure the accounting treatment and financial statements are accurate and reliable to benefit the end users, the public (Panmore Insitute). This paper will summarize the similarities and differences between GASB and FASB accounting and how the modified accrual basis of accounting used primarily for governmental funds differs from full accrual accounting.

In comparison of the two reporting boards, GASB and FASB, there are greater differences then similarities. However, they are similar in that they both are independent nongovernmental organizations and their members are both appointed by the FAF (Encyclopedia of Business, 2nd ed.). Both boards have a general purpose to develop, implement and establish financial reporting standards of…

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