The American Institute of Charted Public Accountants (AICPA) has expressed disappointment at the Financial Accounting Foundation’s (FAF) failure to create an independent standard setting board for private company financial reporting.
AICPA president and chief executive Barry Melancon and AICPA chair Paul Stahlin said the creation of an independent board to set differences in US GAAP standards for privately held companies was the cornerstone of the Blue Ribbon Panel on Standard Setting for Private Companies’ report.
“FAF’s proposal has failed to accept the views of the many voices of the private company constituency asking for a separate board. We don’t think the concerns of smaller private companies can be fully appreciated until there is an independent board dedicated and focused solely on the needs of private companies,” Stahlin said.
AICPA said the blue ribbon report received more than 3,000 letters with 99 percent support for its recommendations.
“Over the years, FASB’s main focus has understandably been on the needs of constituents of publicly traded companies. The pent up frustration we are witnessing by the private company constituency is a direct result of that public company focus and not seeing that differences can be and are appropriate for private companies and their financial statement users,” Melcancon said.