Gasb and Fasb Analysis Paper

GASB and FASB Analysis Paper
Christine Thompson
University of Phoenix

Institutions both public and independent had followed equally comparable reporting models and financial statements up until 1997.   It was at this time that independent institutions such as colleges and universities were required to continue using the not-for profit guides that had initiated back in 1973 by the AICPA.   The College and University Audit Guide established the groundwork for fund based reporting along with FASB 117.   It was in 1984 that GASB was formed to be used by all government organizations excluding the federal government.  
With so many standards and rules, better transparency is needed so that investors, taxpayers, and common readers of financial statements may have a better understanding.   But each standards board has different objectives that the rules and requirements are based upon.   The FASB focus is on the decision factor, its function is to help investors and creditors reach conclusions regarding investment choices.   Whereas GASBs’ focus entails more accountability since the bulk of the financial resources are received from taxpayers.   Here are some of those differences.
Balance Sheet
The differences between the boards’ are fairly apparent when examining the financial statements.   GASB refers to the balance sheet as the statement of net assets, and necessitates that it be classified.   Current assets/liabilities and non-current assets/liabilities must be listed separately FASB permits such documentation but not on the balance sheet.   Both boards recognize three classes of net assets but they are not the same.   GASB classes are unrestricted, restricted, and invested in capital assets.   FASB classes include permanently restricted, temporarily restricted, and unrestricted.
Cash Flow Statement
FASB acknowledges cash flows into three categories, operating, investing, and financing.   When determining cash flows FASB allows both the direct and indirect...