The FASB and GASB are both frameworks to facilitate the reporting of financial information. The operations of both are overseen by the Financial Accounting Foundation. The FASB is responsible for establishing the financial accounting standards for non-government entities and all other non-business organizations (NNOs) not under the umbrella of the GASB. The GASB is responsible for establishing the accounting standards for all state and local governments as well as public colleges, public universities, and government-owned special entities. The overall focus of the FASB is decision usefulness that provides the best information which influences the decision process of an organizations stakeholders. The overall focus of the GASB is accountability to present information as to how the organizations resources were used in accordance with the specific purpose of the fund and public policy. There are four major types of differences between the FASB and the GASB in recognition, measurement display and disclosure. Recognition deals with whether or not an item appears on the financial statements. Measurement deals with which items are included in the financial statements and the amounts that are to be recognized. Display deals with the presentation and classifications of items on the balance sheet. Finally, disclosure deals with what is required in the presentation of financial statements. When addressing the differences of recognition and measurement. There are instances when FASB recognizes items, such as contributed services, while the GASB does not. The FASB has specific criteria in order to identify and recognize these services provided by a non-profit agency. Currently, under the GASB non-profits are not required to recognize these services. In most cases the impact of these services are insignificant and are offset by equal expenses. In cases where these services create a nonfinancial asset, net assets are increased by the value of the services. When addressing the difference of the display of items included in the balance sheet, the GASB requires a classified balance sheet where the FASB does not have this requirement. According to the GASB, assets are defined into three categories restricted, unrestricted, and capital assets net of related debt. The FASB net classes are unrestricted, temporarily restricted, and permanently restricted. Although the FASB has no specific requirements, these are considered as a part of unrestricted assets. When addressing disclosures, the GASB has a requirement for management discussion and analysis (MDA) and the details that should be addressed in this section. The FASB has no such disclosure requirement. In the case of government organizations, this disclosure is essential to providing financial transparency and addressing the overall focus of accountability in government-owned entities. While these are just a few examples, other major differences can be seen in the activity statement and the cash flow statement. Depending on the perspective statements end-user, the GASB framework can provide greater details and tends to report a larger amount of liabilities due to the deferred recognition of revenues. The FASB tends to present a larger amount of total assets and uses a different criteria when reporting net assets. It is very important for the end-user to have some understanding of the basic frameworks of the FASB and the GASB in order to understand the basic differences that can impact the end results.

Critic and summarize.