What is the Difference Between IASB and FASB?

The main difference between the International Accounting Standards Board (IASB) and the Financial Accounting Standards Board (FASB) lies in their focus and jurisdiction. The IASB is responsible for creating International Financial Reporting Standards (IFRS), while the FASB seeks to develop generally accepted accounting principles (GAAP). Key differences between the two include:

1. Focus: The IASB is more focused on the financial reporting side of things, whereas the FASB is most concerned about transparency in accounting practices.
2. Jurisdiction: The IASB is headquartered in London and operates in the UK, while the FASB is based in the US. However, both organizations work towards promoting financial reporting and accounting standards globally.
3. Funding: The IASB receives funding through private donors and corporations, while the FASB is a private-sector body owned and funded by the US Securities and Exchange Commission.
4. Board Members: FASB board members mainly work and reside in the United States, while IASB board members live and work in several nations around the world.

Despite their differences, the IASB and FASB often work together to maintain global accounting standards, as many companies operate on a worldwide scale. They have been working together since 2002 to improve and converge US GAAP and IFRS. The FASB also actively participates in the development of IFRS by providing input on IASB projects through the IASB's Accounting Standards Advisory Forum (ASAF).

Comparative Table: IASB vs FASB

Here is a table outlining the differences between the International Accounting Standards Board (IASB) and the Financial Accounting Standards Board (FASB):

Both the IASB and FASB work towards developing and enforcing financial reporting standards, but they differ in their jurisdiction and authority. The IASB focuses on international accounting standards, while the FASB is responsible for setting accounting principles for US companies. They have been working together on convergence projects to promote consistent accounting standards globally. However, some differences remain in their approach to certain accounting issues, such as the valuation of financial instruments.