This chapter discusses the distinguishing features of state and local governments, the federal government, not-for- profit organizations, and businesses. Recall from your reading that there are separate standard-setting entities for state and local governments (Governmental Accounting Standards Board) and the federal government (Federal Accounting Standards Advisory Board). However, the accounting standards for not-for-profit-organizations and business are established by the Financial Accounting Standards Board. Consider the accounting standard arrangements and address the following questions:
1. How can you support the standard-setting arrangements?
2. Are the characteristics of state and local governments similar enough to the federal government to justify having the same standard-setter?
3. Are the characteristics of non-profit organizations similar enough to state and local government to justify having the same standard-setter?
