Transcript Early History 1887 - 1903

Early History 1887 - 1903
• AIA formed 1887
• Nation in midst of economic growth
 Labor intensive giving way to capital
intensive
• U.S. could not supply needed capital
• Majority of capital – from England
• British investors sent British accountants
1903–1938 Slow Growth of Standards
• 1903 - U.S. Steel first audited F/S
• FTC and FRB created
 Both became concerned about quality of F/S
• 1917 – “Uniform Accounts” published
• 1918 – “Approved Methods …”
published
1903 – 1938 Slow Growth (cont.)
• Stock market crash of 1929
• Communication between AIA and NYSE
 AICPA Committee On Cooperation with
Stock Exchanges
 NYSE Committee on Stock List
• Securities Act of 1933
• SEC Act of 1934
1903 – 1938 Slow Growth (cont.)
• 1933 & 1934 Acts gave SEC authority to
prescribe accounting standards
• Struggle within SEC as to who should set
standards
 3 voted for private sector, 2 for SEC
• ASR #4 issued in 1938 – “substantial
authoritative support”
CAP 1938-1959
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1936 – AIA created special CAP
1938 – expanded CAP created
Issued ARBs and ATBs
Chose not to develop comprehensive
statement or conceptual framework
• Pragmatic (ad hoc) approach
• Authoritativeness – general acceptability
• Reversal of position on taxes
CAP 1938-1959 (cont.)
• Presidents of AIA called for new approach to
standards setting
 Emphasis on greater research basis
• Powell Committee recommended dual
arrangement – APB and research division
• Research division – ARSs
• APB to base conclusions on ARSs
• AIA Council approved report – 1959 APB and
research division established
APB (1959-1973)
• Issuance of & reaction to ARS 1 & 3
• Investment tax credit issue
 APBO #2
 APBO #4
• 1964 “edict” – addendum to APBO #6
• Late 1960s – APB dealt with tough issues
• 1971 – AICPA appointed Trueblood &
Wheat Committees
APB (1959 - 1973)
• Authoritativeness
 APBO 1-5 general acceptability
 APBO 6-27 general acceptability plus
 APBO 28-31 Rule 203
• Final opinion – APBO 31