Chapter 1

Financial Accounting and Auditing Organizations

1 Editor's Note: This chapter aggregates some key contributions of Chapters 1, 5, 9, and 28 from the 11th edition, for reader convenience and to reduce redundancy.

Lynford Graham, CPA, PhD, CFE

Bentley University

1.1 Role of Financial Accounting and Auditing in the U.S. Economy

(a) Objective of Financial Accounting

(b) A Wider Economic Perspective

(i) Linking the Economy to Fair Financial Statements

(ii) Market Efficiency

(c) Participants in the Financial Reporting System

1.2 Accounting Standards in the United States

1.3 Role of the Securities and Exchange Commission

(a) Background of the Securities and Exchange Commission

(b) Structure of the Securities and Exchange Commission

(c) Division of Corporation Finance

(d) Office of the Chief Accountant

(e) Division of Enforcement

(f) Regulations and Publications

(g) Summary

1.4 Financial Accounting Standards Board

(a) Brief History

(b) Structure of the Financial Accounting Standards Board

(c) Board Publications

(d) Due Process Procedures

(e) Conceptual Framework

(f) Standards Overload

(g) Some Criticisms of the Standards

1.5 Governmental Accounting Standards Board

(a) Structure of the Governmental Accounting Standards Board

(b) Jurisdiction Issue

1.6 Federal Accounting Standards Advisory Board

1.7 American Institute of Certified Public Accountants

1.8 U.S. Auditing Standards

1.9 Public Company Accounting Oversight Board

(a) Background

(b) Authority

(c) Structure

(i) Board Members, ...

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