NORWALK, CT (January 2011) – The blue-ribbon panel addressing how U.S. accounting standards can best meet the needs of users of private company financial statements has issued a report of its recommendations to the Financial Accounting Foundation (FAF) Board of Trustees. The report calls for fundamental changes to the system of standard setting including the creation of a new board, to be overseen by the FAF, that would focus on making exceptions and modifications to U.S. GAAP for private companies that better respond to the needs of the private company sector. The report also recommends the creation of a differential framework – a set of decision criteria – to facilitate a standard setter’s ability to make appropriate, justifiable exceptions and modifications. The report does not advocate a move toward a separate, self-contained GAAP for private companies or a comprehensive reorganization of GAAP.
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