FASB Technical Bulletin No. 79-1(R)

Transcription

1 FASB Technical Bulletin No. 79-1(R) FTB 79-1(R) Status Page Purpose and Scope of FASB Technical Bulletins and Procedures for Issuance June 1984 Financial Accounting Standards Board of the Financial Accounting Foundation 401 MERRITT 7, P.O. BOX 5116, NORWALK, CONNECTICUT

2 Copyright 1984 by Financial Accounting Standards Board. All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of the Financial Accounting Standards Board. Page 2

3 FTB 79-1 (Revised): Purpose and Scope of FASB Technical Bulletins and Procedures for Issuance 1. The Financial Accounting Standards Board has authorized its staff to prepare FASB Technical Bulletins to provide guidance on certain financial accounting and reporting problems on a timely basis. This Bulletin describes the purpose and scope of FASB Technical Bulletins, the procedures for issuing them, and related background information. Those procedures have been approved by the Board. Background 2. The scope of FASB Technical Bulletins and the procedures for issuing them were initially established following solicitation of the public's views through two documents, Request for Written Comments on an FASB Proposal for Dealing with Industry Accounting Matters and Accounting Questions of Limited Application, issued on November 7, 1978, and Information about FASB Technical Bulletins, issued on August 10, In August 1982, the Structure Committee of the Financial Accounting Foundation recommended in its report to the trustees that the Board develop a plan to provide more timely guidance for implementation questions and emerging issues. The Board appointed a task force, which solicited the public's views in an Invitation to Comment, Timely Guidance on Emerging Issues and Implementation of FASB Standards, issued in December 1982, and a public hearing held in March In its report to the Board, the task force recommended that the scope of Technical Bulletins be expanded to allow them to address more emerging problems, implementation issues, and specialized industry accounting questions. In December 1983, the Board issued an Invitation to Comment, Proposed Procedures for Implementing Recommendations of the FASB Task Force on Timely Financial Reporting Guidance, to solicit comments on the procedures it proposed to adopt. After consideration of the responses received, the Board decided to expand the scope of Technical Bulletins and to modify the procedures involved in their issuance. The new procedures require that all proposed Bulletins be made available for comment by interested parties. In addition, Board involvement with Technical Bulletins was modified to require Board consideration of all proposed Technical Bulletins at a public Board meeting. Page 3

4 Purpose and Scope of FASB Technical Bulletins and Procedures for Issuance 3. FASB Technical Bulletins provide guidance for applying standards in ARBs, APB Opinions, and FASB Statements and Interpretations and for resolving accounting issues not directly addressed in those standards. The following kinds of guidance may be provided in a Technical Bulletin: a. The guidance in the Bulletin may clarify, explain, or elaborate upon an underlying standard. b. The guidance in the Bulletin for a particular situation (usually in a specific industry) may differ from the general application required by the standard in an ARB, APB Opinion, or FASB Statement or Interpretation. For example, a Bulletin may specify that the standard does not apply to enterprises in a particular industry or may provide for a deferral of the effective date of a standard for that industry. c. The guidance in the Bulletin may address areas not directly covered by existing standards. 4. An accounting or reporting problem that comes to the FASB's attention is analyzed by the staff to determine whether the problem might be resolved by issuing an FASB Technical Bulletin. Generally, a Technical Bulletin can provide guidance if the financial accounting and reporting problem can be resolved within the following guidelines: a. The guidance is not expected to cause a major change in accounting practice for a significant number of entities. b. The administrative cost that may be involved in implementing the guidance is not expected to be significant to most affected entities. c. The guidance does not conflict with a broad fundamental principle or create a novel new accounting practice. Generally, an FASB Statement or Interpretation would be more appropriate to provide guidance than a Technical Bulletin if any one of those guidelines is not met. 5. The director of research and technical activities will release all proposed Technical Bulletins to selected knowledgeable persons or groups for comment prior to issuance. Further, the availability of proposed Bulletins will be publicized so that any interested party can obtain a copy on request to the FASB. Any party may comment in writing to the director of research and technical activities by a designated date that will not be less than 15 days after initial release of a proposed Bulletin. The FASB will maintain a public record of proposed Bulletins released and all written comments received. The public record will be available for public inspection on the same basis as those for other documents under the FASB's Rules of Procedure. Page 4

5 6. All matters proposed for FASB Technical Bulletins will be discussed by the Board at a public meeting and Board members will be provided with copies of all proposed Bulletins prior to their release for comment by interested parties. In addition, all Bulletins and a summary of comments received will be submitted for consideration by the Board at a public meeting prior to final issuance. A Bulletin will not be issued if a majority of the Board members object either to the guidance in it or to communicating that guidance in a Technical Bulletin. 7. The Board may support use of a Technical Bulletin because the nature of the accounting issue addressed and the guidance provided do not, in the Board's judgment, warrant more extensive due process. If the appropriateness of resolving a problem by issuing an FASB Technical Bulletin is in doubt, the Board may choose to issue a Statement or Interpretation to resolve the problem or to take such other action as it deems appropriate. 8. Each Technical Bulletin will specify an effective date and transition provisions for its initial application. While the Board expects that most Technical Bulletins will be applied prospectively, Technical Bulletins may require retroactive application if that is determined to be appropriate in the circumstances. 9. The Board monitors the procedures for issuing FASB Technical Bulletins and, if deemed advisable, may modify the above procedures from time to time. Any modification will be announced publicly. 10. FASB Technical Bulletins are generally in question-and-answer format and are published with the following legend: The Financial Accounting Standards Board has authorized its staff to prepare FASB Technical Bulletins to provide guidance on certain financial accounting and reporting problems on a timely basis, pursuant to the procedures described in FASB Technical Bulletin No (Revised), Purpose and Scope of FASB Technical Bulletins and Procedures for Issuance. Page 5