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Nine content areas of the FASB Codification system addressed

- What is the FASB Codification System and what is its purpose?
- What are the nine content areas located in the FASB Codification System? What types of items are located under each content area?

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What is the FASB Codification System?

-- The Codification system was developed and is maintained by the FASB. It includes GAAP and is "the single source of authoritative nongovernmental U.S. generally accepted accounting principles" (FASB, 2012). Basically, the codification system serves as the largest reference and guidance for all accounting topics. The codification system serves as a research database to accounting and auditing professionals. It is used extensively to determine how various topics in accounting should be handled according to GAAP. The codification system is always monitored and frequently updated. When updates are suggested, they go through a specific process by the FASB where the FASB takes the opinions of professionals into consideration before implementing any changes. This is done this way because accounting changes oftentimes gravely affect companies, and this has to be considered by the FASB before such changes are implemented to accounting standards.

What is the purpose of the FASB Codification System?

-- Basically, it serves as the center where professionals can obtain guidance and information. Due to the size and nature of GAAP, the various sections ...

Solution Summary

- What is the FASB Codification System and what is its purpose?
- What are the nine content areas located in the FASB Codification System? What types of items are located under each content area?

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