Results of 2005 Annual FASAC Survey

On Oct. 28, 2005, the Financial Accounting Standards Board (FASB or the "board") released "Results of the 2005 Annual Financial Accounting Standards Advisory Council (FASAC) Survey" (the "survey" or "survey report").

As part of its advisory role to FASB, FASAC conducts an annual survey to gather views about the FASB's process and direction. The 2005 survey specifically asked for comment on the topics of: FASB priorities, future financial reporting issues, simplification, the right level of implementation guidance, and differential accounting standards for certain entities.

The survey report lists the following as its "key observations and conclusions":

• For the fourth consecutive year, revenue recognition topped the list of issues that FASAC members believe should be the board's priority.
• FASAC members believe that fair value issues, lease accounting, and stock compensation arrangements will require the board's attention in the future.
• FASAC members had a multitude of suggestions for the board on how to address simplification, including field testing proposed standards more aggressively, giving additional weight to cost-benefit considerations, and using more examples to illustrate concepts.
• On the issue of implementation guidance, FASAC members generally believe that the boards' methods to issue guidance are adequate. However, on the question of whether the Board provides the right amount of guidance, responses ranged from not enough to just right to excessive.
• Nearly all FASAC respondents believe that a separate set of accounting standards for private companies is not warranted. Most agreed, however, that the board should continue to address the issue on a case-by-case basis and provide modifications to disclosures or to effective dates of standards when appropriate.

Twenty-seven members of FASAC, including FEI President and CEO Colleen Cunningham, seven FASB board members, and 20 other constituents (including several FEI members who responded on behalf of their companies) were among those listed in the Appendix identifying respondents to the survey.

The complete results of the survey are available here.

Prepared Oct. 28, 2005 by Edith Orenstein (eorenstein@fei.org), Financial Executives International (FEI). This summary does not represent FEI opinion, unless specifically noted above.