Which entity is the primary authoritative body for GAAP for governmental entities?

The Governmental Accounting Standards Board (GASB) is the primary authoritative body for Generally Accepted Accounting Principles (GAAP) specifically for governmental entities. GASB establishes accounting and financial reporting standards for state and local governments in the United States. Its objective is to enhance the transparency and integrity of governmental financial reporting, ensuring that financial statements are reliable and provide the necessary information for users to make informed decisions.

GASB develops standards by engaging with various stakeholders, including state and local governments, and it strives to address the unique accounting challenges faced by these entities. This includes areas such as fund accounting, financial reporting requirements, and the specific needs of citizens, legislators, and oversight bodies.

In contrast, the Financial Accounting Standards Board (FASB) sets standards for private-sector businesses, the International Accounting Standards Board (IASB) develops international standards applicable to public companies globally, and the Government Accountability Office (GAO) is focused on auditing and reporting on government spending rather than establishing accounting standards. This delineation helps ensure that the accounting and reporting frameworks are tailored to the different needs of public versus private sectors.