Question

What is your view on this? Please see below. No internet sources.

If a government finance officer were to ask me why the GASB has to create standards every year, I would give them reasoning around how new standards improve public organizations’ governance around financial performance. In an ever changing political and operational landscape, there are new factors that public organizations need to take into account when tracking their financial performance and projecting the financial health of their organizations going forward. These standards can provide useful guidance to these organizations while helping standardize financial performance tracking across governments. My secondary reason for rolling out standards every year is that it is easier to implement incremental changes in standards versus multiple changes all at once. Annual changes and additions to accounting standards gives organizations enough time to plan and implement the necessary changes.

Answer 1

I stringly agree with the statement given. Introduction of New standards every year by GASB will help better preparation and presentation of financial statements thereby enabling organisations to become more accountable towards their stockholders and public at large. Also, economic environment is a constantly changing phenomenon. To better present those changes through our financials, it will become necessary to incorporate new changes in our existing standards to exhibit the changes in global environment in our financial statements. Sometimes, changes and intro of new standard may occur due to the changed government policies. In order to incorporate those policies in our financials it will become necessary to incorporate the changes made in our financial statements thr the use of newly introduced standards.