Identify the two committes of the ATCPA that established acc

Identify the two committes of the ATCPA that established accounting principles prior to the establishment of the FASB. Committee on Accounting Procedures (CAP) and the Accounting Principles Board (APB). CAP issued 51 Accounting Research Bulletins. The APB replaced CAP and issued 31 APB Opinions What is the present role of the AlCPA In the rulie-making environmens a environment TOSHIBA

Solution

On the ground of encouragement by SEC the accounting body of America set up Committee on Accounting Procedure or CAP in 1939. The role of it was to provide accounting guidance on different matters. CAP issued around 51 bulletins during its tenure. But it always issued a bulletin only when a problem aroused. Due to the above fact the CAP was not successful and it was dissolved in 1959. It failed to develop any considerable accounting framework. CAP was replaced by Accounting Principles Board or APB. APB issued around 31 opinions on accounting and 4 statements, during its tenure. Again APB was not able to achieve its desired purpose and was criticized due to its organizational structure and its views in certain accounting issues. It was dissolved in 1973.

After this FASB came into existence and is the primary body till present day to issue accounting standards and develop the accounting environment. It is an independent body comprising of members who are no longer associated with any industry or firm where they worked. It has a full time members with a limited tenure of office. It works by allocating work to different committees and Financial Accounting Standards Advisory Council or FASAC. It also conducts independent research to determine issues and resolve all sorts of problems and viewpoints looking at them the economic point of view and not the accounting aspects only. Thus FASB has been successful due to credibility, autonomy and independence from any conflicts of interest.