What is FASB?s Role in Sale Leaseback Transactions?

FASB’s Role in Sale Leaseback Transactions are a popular way for entities to get cash without increasing debt. However, these transactions have significant accounting implications for both the seller-lessee and buyer-lessor. These complexities can be complicated and often require an expert to navigate.

The Financial Accounting Standards Board (FASB) is the independent, not-for-profit standard-setting body that establishes and improves generally accepted accounting principles in the United States for the public benefit. The Securities and Exchange Commission (SEC) oversees the work of the FASB, which is funded through accounting support fees paid by U.S. public companies and by the revenue generated from the sale of subscriptions and publications.

Exploring FASB’s Influence on Sale Leaseback Transactions

To develop its standards, the FASB considers both the benefits and costs of each proposed change. The Board seeks to issue standards when their expected benefits outweigh the perceived costs. To help stakeholders understand how the Board weighs the costs and benefits of its standards, the FASB has developed a Plain Language Cost-Benefit Analysis summary.

The FASB also relies on its advisory groups to share their views and experience with the Board. These groups are comprised of a variety of professionals—including CFOS, CEOS, long-time senior partners in top accounting firms, and experts from the analytics or data communities—who can provide unbiased suggestions that will preserve the integrity and goal of the FASB. The FASB is assisted by a staff of more than 60 professionals. Each member of the staff serves full time and is required to sever connections with their former employers to promote independence.