FASB

FASB is the independent board responsible for setting the accounting standards that US public companies must follow when they prepare their financial statements. These standards are collectively known as GAAP, and FASB is the body that writes, updates, and interprets them.

When a company decides how to recognize revenue, account for leases, or value certain assets on its balance sheet, it is following rules that trace back to a FASB standard. FASB operates independently of any single company or government agency, though the SEC has designated it as the official standard setter for US public companies, and it works through a public process of proposals and comment periods before new rules take effect.

For investors, FASB's decisions shape how comparable financial statements are across companies and over time. A change in how revenue or leases must be reported can shift reported earnings or balance sheet figures even when nothing about the underlying business has changed, which is why recognizing that a shift in accounting treatment happened, rather than assuming a company's fundamentals suddenly improved or worsened, matters when comparing results across periods.