Wednesday, April 13, 2011

FAF Annual Report Highlights New Initiatives

The FAF's 2010 Annual Report, released last week, highlights new initiatives undertaken by the Financial Accounting Foundation - overseer of the FASB and GASB - in the past year. Highlights noted in the letter from FAF Chairman John J. Brennan, and FAF President and CEO Terri Polley, which appears in the annual report, include:

  • the FAF's 'Listening Tour' of 2009, in which members of the FAF Trustees travelled around the country listening to constituents, resulting in a number of actions taken by the FAF, including the formation (with the AICPA and NASBA) of the Blue Ribbon Panel on Standard-Setting at Private Companies

  • the 'post-implementation review process' for FASB and GASB standards, launched in 2010

  • video webcasting of FASB board meetings (a change from prior audio-only webcasts) and webcasting of FASB Education Sessions

  • expanded outreach through the FAF's own website, including a periodic online update from FAF President Terri Polley, From the President's Desk,

  • taking on the responsibility for the ongoing maintenance of the US GAAP Financial Reporting Taxonomy - for eXtensible Business Reporting Language or XBRL - applicable to public issuers registered with the US Securities and Exchange Commission (SEC).

  • new appointments in 2010, including Leslie Seidman as Chairman of the FASB; Russ Golden, Daryl Buck, and Hal Schroeder as new FASB board members, and four new FAF members: John Davidson of Tyco, Steve Howe of Ernst & Young, Mack Lawhon of Weaver, LLP and Mary Stone of the University of Alabama.
FASB Chairman Leslie Seidman's letter included in the annual report emphasizes an action-oriented and constituent-responsive approach, illustrated by the verbs heading up various sections of her letter:

listening...focusing...reflecting...converging...responding... modernizing...expanding...acknowledging

Seidman notes the appointment of the three new FASB board members (see above), and notes the appointment of FASB's new technical director, Sue Cosper, as enabling FASB to: "expand and enhance our outreach to constituents, especially private companies and investors."

Among the upcoming initiatives addressed in GASB Chairman Robert H. Attmore's letter included in the annual report is the issuance for public comment of a due process document on GASB's project on fiscal sustainability as relates to economic condition reporting. Specifically, Attmore states:
This project, it is important to note, is not about predictions about what will happen in the future; instead, it is intended to furnish financial statement users with information that will better enable them to assess a government’s financial standing now and its ability to continue to meet its obligations as they come due.
The annual report also includes the FAF's financial statements, footnotes and MD&A, a list of members of the FAF, FASAC, GASAC, the FASB and GASB boards and FASB advisory groups, as well as a clean opinion from audit firm McGladrey & Pullen, and a Management Report on Financial Responsibility and Internal Controls, which includes a voluntary assertion on the effectiveness of internal control (as required for public companies; provided voluntarily by the FAF, a not-for-profit organization).

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