1970s In early May 1972, the 250-member governing council of the
American Institute of Certified Public Accountants gathered in
Boca Raton, Florida to consider the Wheat Report by Francis M. Wheat, formerly of the SEC. The report recommended establishing new financial accounting standards. According to the
New York Times, the accounting field had been under pressure after
accounting-related lawsuits such as the
Yale Express case of 1967 and the
Continental Vending case of 1969. The Wheat Report recommended establishing a seven person Financial Accounting Standards Board (FASB) to replace the
Accounting Principles Board, The FAF was founded on June 30, 1972. The nine trustees were appointed in late September, 1972, with nominations submitted by various businesses. Ralph E. Kent of
Arthur Young & Co was elected president of the Financial Accounting Foundation. Kent asserted that $10 million had been pledged by accounting firms to cover part of the $15 million that would be needed to run the new program for five years. Other officers named were Thomas A. Murphy as vice president, James Don Edwards as secretary, and Thomas C. Pryor as treasurer. The Financial Accounting Foundation published its first draft of accounting rules for the FASB in October 1972.
1980s-1990s In 1984, the FAF created the
Governmental Accounting Standards Board (GASB) to set accounting standards for local and state governments. In 1988, the FAF moved from Stamford to
Norwalk, Connecticut. In November 1989, the FAF voted to limit the jurisdiction of the GASB. Higher-education groups reportedly favored the change, but according to the
New York Times, it also "produced a far-reaching outcry in the accounting profession and the agencies affected," particular state and local government groups, some of which began working to form a new accounting standards agency separate from the FAF. In early 1991, the FAF announced it was potentially facing a third annual deficit, and facing deficits through 1995 unless trends changed. It had shortfalls of $1.6 million in 1990, apparently due to drops in private contributions and publication sales. Shaun F. O'Mally, president of the FAF, said the deficit was not at "matter about which the public should be concerned." The FAF agreed on an internal restructuring in July 1996. The chairman of the Securities and Exchange Commission,
Arthur Levitt Jr., had recently demanded changes. Part of the deal involved the FAF agreeing to expand the foundation directors representing the public to five, rather than one. The FAF board at the time was 16 seats total. The FAF ultimately expanded that year so that half its members came from the public.
2000s In September 2005, the FAF leased new office space in Norwalk, Connecticut. In early 2011, the FAF cut the FASB board from seven members to five members. It had previously had seven board members from 1973 when it was founded until 2008. In late 2022, FAF headquarters continued to be Norwalk. In February 2023, the FAF launched free online access to the FASB's
Accounting Standards Codification and the GASB's Governmental
Accounting Research System, with previously paid-only navigation features made available to all subscribers. In response to SEC recommendations, in April 2023, FAF added features to its website for stakeholders to make complaints about the FASB and GASB's adherence to procedure. == Standards and branches ==