Governmental Accounting Standards Board (GASB)

Definition

The Governmental Accounting Standards Board (GASB) is an independent organization that establishes accounting and financial reporting standards for U.S. state and local governments. Its guidelines aim to ensure transparency, consistency, and comparability in governmental financial statements.

5 Must Know Facts For Your Next Test

1. GASB was established in 1984 to improve governmental accounting standards.
2. It operates under the oversight of the Financial Accounting Foundation (FAF).
3. The GASB's mission is to improve the clarity and usefulness of financial reports for government entities.
4. GASB issues Statements of Governmental Accounting Standards which are considered authoritative guidance.
5. Compliance with GASB standards is essential for government entities to receive clean audit opinions.

Review Questions

• What year was the GASB established?
• Why is compliance with GASB standards important for government entities?
• Under whose oversight does the GASB operate?

Related terms

Financial Accounting Foundation (FAF): An organization that oversees both the FASB and GASB.

Statements of Governmental Accounting Standards: Authoritative guidance issued by the GASB.

Audit Opinion: A formal statement made by an auditor about whether a set of financial statements complies with generally accepted accounting principles.