Which board establishes federal accounting standards in the U.S.?

The Federal Accounting Standards Advisory Board (FASAB) is the entity responsible for establishing federal accounting standards in the United States. This board was created to develop generally accepted accounting principles (GAAP) for federal entities, addressing the unique needs of financial reporting in the federal government. It operates under the authority of the Office of Management and Budget (OMB) and the U.S. Congress, ensuring that federal financial statements are transparent, consistent, and accountable.

FASAB emphasizes the importance of relevant and reliable financial information for government officials, the public, and other stakeholders by promoting high-quality financial reporting standards. Its guidelines help ensure that the financial activities of the federal government are managed and reported effectively, facilitating good governance and sound financial management.

Understanding the role of the FASAB is crucial for those involved in government financial management, as it sets the framework within which federal financial reports are prepared and audited, thereby impacting decision-making and accountability in federal financial reporting practices.