FASB Accounting Standards Codification

FASB ASC is effective for financial statements issued for interim and annual periods ending after September 15, 2009. The Statement does not change GAAP, but it represents a restructuring of accounting and reporting standards and organizes the literature by topic.

The purpose of FASB ASC is primarily to:

• Mitigate the risk of noncompliance with standards through improved usability of the literature.

• Provide accurate information with real-time updates as new standards are released.

• Make clear that guidance NOT contained in FASB ASC is NOT considered authoritative.

FASB Statement No. 168 is the final standard that will be issued by the FASB in this form. Subsequent accounting standards will no longer be in the form of Statements, Staff Positions, Emerging Issues Task Force (EITF) Abstracts, or AICPA Accounting Statements of Position.  Instead, the FASB will issue Accounting Standards Codification Updates.

FASB ASC will affect the way companies reference GAAP in their financial statement footnotes. The following should be considered when preparing financial statements for periods ending after September 15, 2009:

• Specific elements of GAAP referenced in the financial statement footnotes should reference the Codification (i.e. FASB ASC XXX-XX-XX-XX).

• Instead of referencing specific GAAP in the financial statement footnotes, companies may find it more useful to the users to describe the specifics of the accounting policy, rather than disclose the FASB ASC reference. This is encouraged by the FASB.