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FINANCIAL ACCOUNTING FOUNDATION AND SEC REACH AN AGREEMENT

Both the AICPA and the Financial Executives Institute helped resolve the confrontation between the Financial Accounting Foundation--the parent organization to the Financial Accounting Standards Board--and the SEC. As explained in some detail in News & Views in July 1996, the SEC was of the opinion that the FAF, the organization that selects FASB members and raises the funds necessary to support the activities of FASB, should have more "public" representation. In a letter to the SEC dated May 20, 1996, Michael Cook, chair of the FAF, stated that apart from filling two existing at-large seats with public members, the FAF was not in a position to expand the public representation.

The two sponsoring organizations (AICPA and FEI) each agreed to give up control of one of its designated members of FAF, thereby increasing the number of spots for those representing the public interest. These two additional spots, plus the three existing at-large positions, plus the three positions from representatives of government (who the SEC is now willing to place in the public sector column) give a total of eight of the total of 16 trustees that are deemed to represent the public interest. Such an alignment is agreeable to the SEC.

Is the storm over? The CPA Journal spoke with Arthur Wyatt, former FASB member, past chair of the International Accounting Standards Committee, past member and chair of the AICPA Accounting Standards Executive Committee, retired partner of Arthur Andersen LLP, and professor at the University of Illinois to learn of his views on the controversy and its resolution. The interview with Mr. Wyatt will appear in the December issue. *

The CPA Journal is broadly recognized as an outstanding, technical-refereed publication aimed at public practitioners, management, educators, and other accounting professionals. It is edited by CPAs for CPAs. Our goal is to provide CPAs and other accounting professionals with the information and news to enable them to be successful accountants, managers, and executives in today's practice environments.

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