The Financial Accounting Standards Advisory Council, the main advisory group for the Financial Accounting Standards Board, has released the results of a recent survey soliciting views about FASB’s future agenda, revealing pent-up demand for addressing issues such as financial disclosures, hedging and simplification of FASB’s Codification of U.S. GAAP.
The top projects that survey participants thought should be on FASB’s agenda were the disclosure framework, accounting for financial instruments hedging, the conceptual framework, financial instruments with the characteristics of equity, and pensions, which tied for fifth place.
With the completion of several major FASB projects―particularly revenue recognition―expected to take place at some point in the near future, the survey provided FASB stakeholders with the opportunity to share their views on projects and areas that they believe are the most important for FASB to address.
Approximately 50 percent of the responses indicated a need to resolve one or more potential projects within the next 24 months. The projects that seemed to attract the most comments in this area were the conceptual and disclosure frameworks and the projects on financial instruments.
Survey respondents stressed the importance of completing some of the significant projects on FASB’s current agenda, along with the continued importance of addressing the needs of the private company and not-for-profit communities.
The three main reasons why respondents said they thought FASB should undertake the top priorities were that simplification is needed, better information is needed, and the current information does not provide decision-useful information to investors and other users of financial reports.
Approximately half of the respondents indicated they support the reorganization or enhancement of FASB’s Codification of accounting standards. The stakeholder group with the strongest level of support for reorganization or enhancement among the respondents was accounting firms and auditors, with 71 percent of respondents from accounting firms responding that the Codification should be enhanced.
“The FASAC survey provides important feedback to the FASB on where to focus our efforts, both now and in the future, in our mission to reduce complexity and improve the relevance of financial reporting for both public and private companies,” said FASB chairman Russ Golden in a statement. “The results of the 2013 FASAC survey are a valuable source of information about what our project priorities should be and will help guide our decisions about where to deploy resources to address issues stakeholders have told us are most urgently in need of improvement.”
Survey respondents represented a diverse group of FASB stakeholders, including preparers (38 percent), accounting firms (22 percent), users (12 percent), academics (8 percent), industry organizations (6 percent), and other (14 percent).
“Part of the FASAC’s role is to advise the FASB on future project priorities and on possible new agenda items,” said FASAC chairman Charles Noski. “While opinions varied on specific projects and issues, FASB stakeholders agreed that simplifying standards, and improving the relevance of information that results from those standards, should be among the board’s top priorities.”
The complete results of the 18-question FASAC survey are also available on FASB's Web site.