Interpretive Release Commission Guidance Regarding the Financial Accounting Standards Board's Accounting Standards Codification 33-9062A, 34-60519A, FR-80A

SECURITIES AND EXCHANGE COMMISSION
17 CFR PARTS 211, 231, AND 241
Release Nos. 33-9062A; 34-60519A; FR-80A
Commission Guidance Regarding the Financial Accounting Standards Board's
Accounting Standards Codification
AGENCY: Securities and Exchange Commission.
ACTION: Interpretation.
SUMMARY: The Securities and Exchange Commission (the “Commission”) is
publishing interpretive guidance regarding the release by the Financial Accounting
Standards Board (“FASB”) of its FASB Accounting Standards CodificationTM (“FASB
Codification”).
EFFECTIVE DATE: August 25, 2009
FOR FURTHER INFORMATION CONTACT: Questions about specific filings
should be directed to staff members responsible for reviewing the documents the
registrant files with the Commission. General questions about this release should be
referred to Jenifer Minke-Girard, Senior Associate Chief Accountant, or Jeffrey S.
Cohan, Senior Special Counsel, Office of the Chief Accountant, at (202) 551-5300,
Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-6628.
SUPPLEMENTARY INFORMATION:
I. 	Background
Section 108 of the Sarbanes-Oxley Act of 20021 amended Section 19(b) of the
Securities Act of 19332 to provide that the Commission may recognize, as generally
1 Pub. L. 107-204, 116 Stat. 745 (2002).

accepted for purposes of the securities laws, any accounting principles established by a
standard setting body that meets specified criteria. On April 25, 2003, the Commission
issued a policy statement concluding that the FASB and its parent organization, the
Financial Accounting Foundation, satisfied the criteria for an accounting standard setting
body under the Act, and recognizing the FASB’s financial accounting and reporting
standards as “generally accepted” for purposes of the federal securities laws.3
On June 30, 2009, the FASB issued FASB Statement of Financial Accounting
Standards No. 168, The FASB Accounting Standards CodificationTM and the Hierarchy
of Generally Accepted Accounting Principles – a replacement of FASB Statement No.
162 (Statement No. 168), to establish the FASB Codification as the source of
authoritative non-Commission accounting principles recognized by the FASB to be
applied by nongovernmental entities in the preparation of financial statements in
conformity with U.S. generally accepted accounting principles (“U.S. GAAP”).
Statement No. 168 is effective for financial statements issued for interim and annual
periods ending after September 15, 2009. The FASB Codification reorganizes existing
U.S. accounting and reporting standards issued by the FASB and other related private-
sector standard setters, and all guidance contained in the FASB Codification carries an
equal level of authority.4
The FASB Codification directly impacts certain of the Commission's rules,
regulations, releases and staff bulletins (collectively referred to in this release as
2 15 U.S.C. 77s(b).
3 See Commission Statement of Policy Reaffirming the Status of the FASB as a Designated Private-Sector
Standard Setter, Release Nos. 33-8221; 34-47743; IC-26028; FR-70 (April 25, 2003) [68 FR 23333 (May
1, 2003)].
4 The FASB Codification is available at http://asc.fasb.org/home.
2

"Commission’s rules and staff guidance"), which refer to specific FASB standards or
other private sector standard-setter literature under U.S. GAAP, because such references
are now superseded by the FASB Codification. The Commission is therefore issuing
interpretive guidance to avoid confusion on the part of issuers, auditors, investors, and
other users of financial statements and Commission rules and staff guidance.
II. 	Discussion
Many parts of the Commission’s rules and staff guidance include direct references
to specific standards under U.S. GAAP. For example, Regulation S-X, which, together
with the Commission's Financial Reporting Releases, sets forth the form and content of
and requirements for financial statements required to be filed with the Commission,5
includes specific references to specific standards under U.S. GAAP.6 In addition, some
parts of the Commission’s rules and staff guidance outside of the financial statement
context include specific references to specific standards under U.S. GAAP, such as in
Item 402 of Regulation S-K regarding disclosure of executive compensation.7
Given the possible confusion between the Commission’s rules and staff guidance,
on the one hand, and the FASB Codification, on the other hand, the Commission believes
it is necessary to publish the guidance in this release. Concurrent with the effective date
of the FASB Codification, references in the Commission’s rules and staff guidance to
specific standards under U.S. GAAP should be understood to mean the corresponding
reference in the FASB Codification. We note that the FASB Codification includes a
5 17 CFR 210.1-01.
6 See, e.g., Rule 1-02(u) of Regulation S-X [17 CFR 210.1-02(u)], which defines the term “related parties”
by reference to FASB Statement of Financial Accounting Standards No. 57, Related Party Disclosures.
7 17 CFR 229.402.
3

cross-reference finding tool that can assist users in identifying where previous accounting
literature resides in the FASB Codification. The Commission and its staff also intend to
embark on a longer term rulemaking and updating initiative to revise comprehensively
specific references to specific standards under U.S. GAAP in the Commission’s rules and
staff guidance.
It should be noted that although the FASB has stated that the FASB Codification
supersedes existing references in U.S. GAAP, the FASB Codification does not supersede
Commission rules or regulations. We understand that the FASB Codification, as a
service to users, includes references to some Commission rules and staff guidance.
However, the FASB Codification is not the authoritative source for such content, nor
does its inclusion in the FASB Codification affect how such content may be updated in
the future.
III. 	Codification Update
The "Codification of Financial Reporting Policies" announced in Financial
Reporting Release No. 1 (April 15, 1982) [47 FR 21028] is updated by adding at the end
of Section 101, under the Financial Reporting Number (FR-80A) assigned to this
interpretive release, the text in Sections I and II of this release.
The Codification is a separate publication of the Commission. It will not be
published in the Federal Register/Code of Federal Regulations.
List of Subjects
17 CFR Part 211
Reporting and recordkeeping requirements, Securities.
17 CFR Parts 231 and 241
4

5
Securities.
Amendments to the Code of Federal Regulations
For the reasons set out in the preamble, the Commission is amending title 17,
chapter II of the Code of Federal Regulations as set forth below:
PART 211 - INTERPRETATIONS RELATING TO FINANCIAL REPORTING
MATTERS
Part 211, Subpart A, is amended by adding Release No. FR-80A and the release
date of August 18, 2009 to the list of interpretive releases.
PART 231 - INTERPRETATIVE RELEASES RELATING TO THE SECURITIES
ACT OF 1933 AND GENERAL RULES AND REGULATIONS THEREUNDER
Part 231 is amended by adding Release No. 33-9062A and the release date of
August 18, 2009 to the list of interpretive releases.
PART 241 - INTERPRETATIVE RELEASES RELATING TO THE SECURITIES
EXCHANGE ACT OF 1934 AND GENERAL RULES AND REGULATIONS
THEREUNDER
Part 241 is amended by adding Release No. 34-60519A and the release date of
August 18, 2009 to the list of interpretive releases.
By the Commission.
Florence E. Harmon
Deputy Secretary
Dated: August 19, 2009