FASB
Accounting Standards Codification TM
Thomas Hoey
Director of the FASB Codification and XBRL Projects
April 30, 2009
© 2009 Financial Accounting Standards Board
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Agenda
Codification Project
XBRL Project
Brief Demo
© 2009 Financial Accounting Standards Board
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Current State
FASB Staff Positions
FASB Statements
Accounting Principles Board Opinions
Accounting Research Bulletins
FASB Technical Bulletins
AICPA Statements of Position
AICPA Audit and Accounting Guides
EITF Appendix D
EITF Abstracts (and issue summaries)
AICPA Practice Bulletins
AICPA Technical Questions and Answers
FASB Concepts Statements
SEC S-X Rules
FASB Staff Implementation Guidance
AICPA Audit Risk Alerts
AICPA Accounting Interpretations
SEC S-K Items
SEC SAB Codification Topics
© 2009 Financial Accounting Standards Board
FASB Interpretations
AICPA Issues Papers
SEC Speeches—Topics Covered
SEC ASR / FRR Codification Sections
Note: Not all of the above are level A-D GAAP and
therefore are not in the FASB Accounting Standards Codification
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Why a Codification?
Multiple types of standards, multiple
standard setters, multiple indexing
schemes, and different levels of
authority make it difficult to retrieve all
relevant U.S. GAAP
Constituent concern that U.S. GAAP is
overly confusing and difficult to research
© 2009 Financial Accounting Standards Board
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Need for change
User survey - Over 1,400 participants
– 80% believe the structure of U.S. GAAP is confusing
– 85% believe that research takes an excessive amount of time
– 95%agree that the FASB should pursue a codification
Structure survey
– 90% agree that the structure is easy to understand and will
simplify access
– 97% believe that the structure is an improvement or significant
improvement when compared with existing GAAP
Research system survey – over 3,200 participants
– Priority – Topic, Search, GoTo
– 90% expect to access electronically rather than hard copy
© 2009 Financial Accounting Standards Board
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What Is the Codification?
Current level a-d U.S. GAAP issued by a standard
setter codified into a topically-organized format
NOT intended to change U.S. GAAP
Upon approval by the FASB, it will be the
authoritative source for U.S. GAAP and will
supersede existing sources of U.S. GAAP
Any sources of U.S. GAAP not included in the
Codification will be NON-authoritative
On-line Codification Research System designed for
the topically-organized content to improve
retrievability
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Content
Codification
– includes authoritative guidance
for example, standards sections, implementation
guidance, and so forth
– excludes non-authoritative or redundant content
for example, much of basis for conclusions
Codification Research System
– provides a mapping feature to help users identify
where standards are used in the Codification
© 2009 Financial Accounting Standards Board
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SEC Content
Updated by the SEC
Included in Codification as separate SEC
Sections
– SEC guidance is required only for SEC registrants
– Many private companies do not want SEC
guidance
SEC Material Sections include the full text of
the relevant guidance
© 2009 Financial Accounting Standards Board
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How Is the
Codification Structured?
Terminology is important for effective communication
– Areas—Groupings of topics
General Principles
Presentation
Financial Statement Accounts
– Assets, Liabilities, Equity, Revenue, Expense
Broad Transactions
– Business Combinations, Leases, etc.
Industry
– Topics—Broadest categorization of related content
– Subtopics—Distinguished by type or scope
– Sections—Nature of the content, such as recognition,
measurement, disclosure, and so forth
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Illustration
Leases
Topic
Subtopics
Sections
Operating
Leases
Overall
Scope
Lessees
Disclosure
Lessees
Scope
Lessees
Capital
Leases
Disclosure
Lessees
Scope
Lessees
Disclosure
Lessees
Subsections
Lessors
Lessors
Lessors
Lessors
Lessors
Lessors
Note: This is for illustration only and does not include all Topics, Subtopics, Sections and Subsections.
© 2009 Financial Accounting Standards Board
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Updating the Codification
The FASB will develop Codification update instructions
to document changes to the Codification
When the Codification becomes authoritative
– The FASB will continue to issue individual standards in the form
of Codification Updates numbered as Year – Sequence
For example, FASB Codification Update 2009-03
– The FASB will update the Codification concurrent with the
release of a Codification Update
– Exposure drafts will contain proposed changes to the
Codification
Current and transitional text presented together so that
users can view both current and transitional text
concurrently without the need to search for it
© 2009 Financial Accounting Standards Board
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Status and Timing
System availability - http://asc.fasb.org
– Available since January 2008
– Over 55,000 registered users
Currently processing Codification Updates for
verification feedback and new standards
– Roughly 1,500 pieces of feedback by cutoff date
Board actions
– Met February 25, 2009
– Exposure draft released March 27, 2009
– Expected to be authoritative as of July 1, 2009
© 2009 Financial Accounting Standards Board
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Demonstration
© 2009 Financial Accounting Standards Board
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XBRL Background
During the conceptual design phase of the
Codification in 2004, it was determined to
establish the Codification as the
designated authoritative electronic
reference source for tagged XBRLfinancial
statements (i.e., interactive data)
© 2009 Financial Accounting Standards Board
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The Vision
Literature
Research
Financial
Statement
Research
"Edgar 2"
Tagged
XBRL
Financial
Statements
© 2009 Financial Accounting Standards Board
Link to
Literature
FASB
Accounting
Standards
Codification
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XBRL Project
US GAAP Taxonomy contains roughly 13,000
elements
Elements currently reference existing standards
that will be superseded by the Codification
Project team established links to the Codification
Codification will display XBRL elements linked to
particular paragraphs
Going forward, FASB and XBRL-US coordinate
taxonomy changes
© 2009 Financial Accounting Standards Board
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End
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