Breaking News: FASB Shrinks

A controversial proposal to reduce the board from seven members to five appears to have been approved.
Marie LeoneFebruary 26, 2008

The Financial Accounting Standards Board’s governing body has voted to reduce the number of people who serve on FASB.

On Tuesday, the Financial Accounting Foundation approved all of its recent proposals for governance changes to FASB, FAF, and the Government Accounting Standards Board during a closed meeting. could not get specific details about the vote itself, but a press conference is scheduled for this afternoon. Ellyn Brown, one of the FAF trustees, announced to the press that all of the proposals on the agenda had been adopted by FAF.

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The majority of comment letters FAF trustees received in recent months opposed the controversial proposal to reduce the membership of FASB. “A reduction in the size of the FASB is likely to compromise the outreach to its constituency, since there will be fewer members shouldering an ever increasing workload,” wrote the CFA Institute Centre, a research and policy organization.

The proposal also gave the FASB chairman the sole authority to set the board’s agenda.