"Looking Back on Fourteen Years at the FASB: The Education of A Standard Setter".

Abstract This article presents an explanation by Professor of Accounting Donald J. Kirk on the impact of the United States Financial Accounting Board on business enterprises. Among the projects on the Board's initial agenda were accounting for research and development costs and accounting for contingencies. The need for workable definitions of assets and liabilities became apparent in those projects and served as a catalyst for the part of the framework projects that became Financial Accounting Standards Board (FASB) Concepts Statement No. 3, Elements of Financial Statements of Business Enterprises (1980). The results have proved very useful to the Board and its staff in analyzing problems and have served as a common language within the Board and in communications between the Board and the various constituent groups that participate in the standard-setting process. I would discourage the FASB from readdressing the conceptual issues in the near future and suggest they await further insights from their current laboratory test--the project on disclosing and accounting for financial instruments. The odds are much better that reliable value measures can be developed for financial instruments than for fixed assets, the latter having been the Achilles' heel of Statement 33. Also, holding gains and losses from financial instruments are potentially more acceptable candidates for admission into periodic income than were what Statement 33 euphemistically called increases or decreases in current cost.