NASHVILLE, TENN. (January 29, 2013) – The Board of Directors of the National Association of State Boards of Accountancy (NASBA) at its January 25, 2013, meeting unanimously voted to adopt a resolution regarding the American Institute of Certified Public Accountants’ (AICPA) exposure draft: Proposed Financial Reporting Framework for Small- and Medium-Sized Entities (FRF-SME).
In that resolution, the NASBA Board of Directors urged the AICPA to either table or withdraw the proposal in order to allow the Financial Accounting Foundation’s Private Company Council (PCC) adequate opportunity to develop standards uniquely applicable to private companies that can be authoritative and part of generally accepted accounting principles (GAAP).
“There are increasing demands for significant improvements in the current financial reporting system serving the unique needs of private companies and their many stakeholders. We share those concerns with the AICPA, but we also recognize that well thought out and authoritative solutions stand a better chance of long-term success. The FASB and the PCC deserve our undivided support in their mission to improve GAAP for this critical sector of the U.S. economy,” said Gaylen Hansen, Chair of the NASBA Board of Directors.
Under the Tenth Amendment of the U.S. Constitution and the Sarbanes-Oxley Act, Section 209, State Boards of Accountancy are vested with significant authority in the development, adoption and enforcement of standards. This authority is particularly relevant as it relates to the private sector and the topic of the AICPA’s FRF-SME proposal.
Given this authority, the NASBA Board of Directors in a letter to the AICPA’s Director of Private Company Financial Reporting expressed its concern regarding the current proposal. The resolution of the NASBA Board of Directors can be found in the News section of this website, under “Comment Letters.”
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