Governmental Accounting Standards Board
From Wikicpa
The Governmental Accounting Standards Board (GASB) was organized in 1984 as an operating entity of the Financial Accounting Foundation (FAF) to establish standards of financial accounting and reporting for state and local governmental entities. Its standards guide the preparation of external financial reports of those entities. The Foundation's Trustees are responsible for selecting the members of the GASB and its Advisory Council, funding their activities and exercising general oversight-with the exception of the GASB’s resolution of technical issues.
The GASB’s function is important because external financial reporting can demonstrate financial accountability to the public and is the basis for investment, credit and many legislative and regulatory decisions.
Mission
The mission of the Governmental Accounting Standards Board is to establish and improve standards of state and local governmental accounting and financial reporting that will result in useful information for users of financial reports and guide and educate the public, including issuers, auditors, and users of those financial reports.
The GASB has issued Timeline of Governmental Accounting Standards - US#Governmental Accounting Standards Board defining GAAP for state and local governments since 1984. GAAP for the Federal government is defined by the Federal Accounting Standards Advisory Board.
Uses and Users of Governmental Accounting and Financial Reporting
Accounting and financial reporting standards are essential to the efficient and effective functioning of our democratic system of government:
- Financial reporting plays a major role in fulfilling government's duty to be publicly accountable.
- Financial reporting by state and local governments is used to assess that accountability and to make economic, social, and political decisions.
The primary users of state and local government financial reports are those:
- To whom government is primarily accountable—its citizens,
- Who directly represent the citizens—legislative and oversight bodies, and
- Who finance government or who participate in the financing process—taxpayers, other governments, investors, creditors, underwriters, and analysts.
Government administrators also are users of financial reports; whether they are considered primary users depends on whether they have ready access to internal information.
