Using the FASB Codification of Accounting Standards

The Financial Accounting Standards Board (FASB) Codification of Accounting Standards is the current single source of the United States Generally Accepted Accounting Principles (GAAP). The Codification of Accounting Standards is a database and research system created by the Financial Accounting Standards Board that combines many of the authoritative resources about accounting standards into one searchable system. Some of the people who would use the Codification are accounting and reporting professionals, financial analysts, and investors. The FASB Codification allows users to easily search and navigate the content, cutting back on research time and making access to information quicker and more efficient. It was created with the goal to simplify user access to all authoritative U.S. GAAP, reduce the amount of time and effort required to solve an accounting research issue, mitigate the risk of noncompliance, and provide real-time updates as new standards are released.

The FASB Codification includes all level A through D generally accepted accounting principles (GAAP) issued by a standard setter and pronouncements issued by the FASB, the Emerging Issues Task Force (EITF), Accounting Standards Executive Committee (AcSEC), Accounting Principles Board, and relevant portion of authoritative content issued by the Securities and Exchange Commission (SEC). The Codification reorganizes the thousands of U.S. GAAP pronouncements into about 90 accounting topics. Some of its features include the ability to browse by topic, cross referencing options, various print options, archives, a glossary, the ability to email, and a section to quickly find the latest updates and recently issued content. The Codification was not intended to change GAAP, but rather make it easier to find general accepted accounting principles and make frequently unknown GAAP easier to find. The FASB Statement No. 168 (Topic 105) identifies the Codification as the single authoritative source for U.S. GAAP, eliminates the US. GAAP hierchy for nongovernmental entities, and makes it effective for periods after September 15, 2009. The FASB Accounting Standards Codification was publicly launched on July 1st, 2009. The FASB actually made the Codification available for free for one year, between January and December of 2008. During this period, the FASB urged users to provide feedback. The Codification has three different views available, Professional View, Academic View, and Basic View. For an annual subscription of $850, users can access the Professional View of the Codification which is complete access to the database and its functions. Colleges and Universities can pay $250 a year to AAA for Academic Access, which is discounted access to the Professional View, for its faculty and students in registered accounting programs/departments. The Basic View is free access but has limited functionality. Users can register free of charge online at http://asc.fasb.org. The FASB Accounting Standards Codification is organized into four different parts: Areas, Topics, Subtopics, and Sections. Each of these have their own separate page referred to as landing pages. The Area, Topics, and Subtopic landing pages only contain a table of contents associated as well as the links to the pages of the following lower level of the content. In just four simple clicks, you will be able to navigate to a Section's page from anywhere within the system's levels. In order to assist with navigation of the Area's section of the system, the Codification has been divided into nine different content areas. The Codification's nine Areas are “General Principles, Presentation, Assets, Liabilities, Equity, Revenue, Expenses, Broad Transactions, and Industry” (Accounting Standards Codification). In the Area landing page, it contains a list of the Topics in that Area. A Table of Contents outline is found in each Topic, Subtopic, and Sections landing page, including each sections numbers and titles showing how content is organized within each section. Once you enter the Topics page, you can immediately find the Topic’s Subtopics listed. There are some Topics with one Subtopic while other Topics have many Subtopics. The Topics content usually consist of related material for a particular subject area. “For example, within the Assets Area, Topics include Cash and Cash Equivalents, Receivables, Investments, Inventory, and various others” (Wahlen, Jones and Pagach). Subtopics are Topics are divided into smaller sections that are recognized by type or by scope. When searching the Subtopic pages, you will find many of the Subtopic’s Sections that contain the Section’s number and title link to the page for that Section. In each Subtopic, you will find links to the Subsections that break down and improve the Sections content. However, when a Subsection is necessary, it is not numbered but does however list the Paragraphs that contain the precise text of the supervision that constitutes GAAP (Wahlen, Jones and Pagach). A user account and access to the internet is required to use the system. To create accounts go to the website https://acs.fasb.org. Click on the “Login” link in the upper right of the screen. If a user had an existing account, they would just enter in the username, which is the email address that you registered with, and password. For users who don’t have an account, one can created by clicking the “First time users – Order Professional or Basic View” link. There are two types of accounts that you can create, Profession View and the Basic View. The Basic View is the free access version of the site. This type of account offers users limited functions you within the system. For example, there are no search functions, and no advance navigation options. The basic view does include the ability to browse by topic, offers basic printing, and utility to identify the location of legacy standards. The Professional View provides full access to the website that has features and navigating that helps research topics more quickly and efficiently. Full access to the website includes searching by keywords and advance search. The “Go To” function allows experienced user to jump directly to the any lever within the Codification hierarchy without having to browse or search. Professional View allows users to join and combine different pieces of content onto a single page. The Professional View has “Cross Reference” link at the top of any web page of the system that provides users with a cross reference to identify the original standard used to create the Codification. The Professional View access gives user more printer options, which include: “Printer Friendly”; “Printer Friendly with TOC”, this has a table of contents associated with the printed page; “Printer Friendly with sources”, this includes references to the sources; and “Large Image Display”, which allows you to adjust the page size to print certain large images. Users have access to content that has been archived on the system. Also, users have access to a master glossary of terms used within the Codification. There is a Master Glossary, which is always accessible from the menu navigation. The Subtopic Glossary displays terms that are located within the current Subtopic. Also, within each subsection, terms are highlighted the first time they are mentioned. Rolling over the term with the mouse will show the definition. Professional View has a feature called “What’s New”, that provides access to recently issued content. Another feature called “What Link Here” helps identify content related to a specific paragraph. Full access allows users to send emails of the content found on the system, create personal notes about the selected content, and copy and paste content to another program. Lastly, the full access allows users to quickly identify the location of the content when working at the paragraph level. There is a fee to have access to all of the features of the Profession View of $850.00 for an annual subscription of a single user. To create an account with Basic access, select Basic View option on the webpage and complete the form by providing all the required information. To finish the registration process, users will need to acknowledge the License Agreement. A confirmation of the registration will be received after the completion of the process, and then users are able to proceed to the Accounting Standards Codification login page. Once logged in, users will be able to navigate through the homepage. “About the Codification” is a guide to system that offers help, frequently asked question, and an overview of the system. “Providing Feedback” allows users to submit feedback, and system-related comments. “What’s New” is a list of the recent modifications and enhancements made to the website. On the left, users will find the navigation bar, which is used to research topics. Suppose that you are not sure how to record receivables according to GAAP rules. The only thing that you know for sure is that receivables are a type of an asset. After you successfully logged in to the www.fasb.org, go to the left column of the home page and click Assets then click on Receivables, (Codification number 310). After that, you are going to be able to see a menu containing subtopics. If you are not sure exactly what to elect, choose Overall (Codification number 10). This is the option that would give you broad information regarding your research. Then click on Initial Measurement (Codification number 30) option which takes you to paragraphs having information pertaining to the answer of your question.(Pay attention to the combined Topic/Subtopic Codification number is 310-10-30). At this time, look over the paragraphs and you will be able to read general information about receivables. The first paragraph (30-1) titled Certain Receivables explain to you about initial measurement regarding notes receivables, especially those receivables exchanged for cash, properties, goods or services. If you want, go further and keep exploring the other paragraphs and read about Purchased Loans, Notes exchange for cash and notes receivables. Notice that some paragraphs are longer than others that depend on the complexity of your research. Now suppose that your Internet connection was disconnected and you want to come back where you were before. After you login to the same site look in the left part of the page where the box named codification is and type 310-10-30-1. This action will take you where you were before; unfortunately this feature is available for professional viewers only. As a basic viewer subscriber you won’t be able to move around the web site freely because the information provided under this type of subscription is very limited. What you can do is obtain as much information as possible and have a general idea about what the site offers and what you can do about your research. You can also submit feedback after your read each paragraph and if you have the option to upgrade to subscription to a professional view, you will be able to submit annotations. In conclusion, the accounting professional members who encompass the FASB has succeeded in raising financial accounting standards while educating the general public who make use and readily use this information. These goals include implementing additional research that lead to the reliability of the reporting, making sure to keep all standards current to remain in line with the current economy and across various financial markets, recognizing any reporting issues and enlisting new ways to improve the reporting methods, improving the quality of the reporting, and lastly improving how users understand the financial reporting and the purposes thereof. As previously described. The FASB was designed in 1973 by the Securities and Exchange Commission to develop the general accepted accounting principles (GAAP), and has set and met the accounting standards of the United States to date. For approximately 5 years, several hundred team members worked to establish the FASB Accounting Standards Codification database that encompasses the several thousand standards established by the U.S. GAAP. This database was made available to the general public in 2009. The codification of these standards helps to reach three primary goals: allow simple access by users, guarantee that all codified GAAP is represented clearly and fully, and lastly, ensure that all standards are provided, including the most up to date of standards. With detailed outlined steps, this framework allows for the most simplest of users to follow step-by-step guidelines to complete any directions given. Subsections combined with Subtopics and various other levels allow for easy searching and referencing. This ultimately led to decreasing the amount of time that was initially used to research an accounting issue or concern; while increasing one’s ability to fulfill GAAP requirements.
Works Cited "FASB: Financial Accounting Standards Board."FASB: Financial Accounting Standards Board. N.p., n.d. Web. 02 Dec. 2013.

Lucas, Tim, Elaine Harwood and Ryan Miller. GAAP: The Effect of the Codification on Accountant and Auditor Liability Cases January 2011.

Wahlen, James, Jefferson P. Jones and Donald Pagach. The FASB Accounting Standards Codification: A User-Friendly Guide. Cengage Learning, 2012.