Which of the following statements is true of the Financial Accounting Standards Board (FASB)?
A)Its authority comes from the Internal Revenue Service.
B)It consists of five members appointed by the Federal Trade Commission (FTC).
C)Its members can be reappointed to serve one additional term.
D)Its members can retain ties with firms in which they were previously employed.

Question

Quizplus · Accepted Answer

The FASB consists of seven members who can serve two five-year terms, for a total of ten years. Therefore, its members can be reappointed to serve one additional term. Option A is incorrect because the FASB's authority comes from the Securities and Exchange Commission (SEC), not the Internal Revenue Service. Option B is incorrect because the FASB members are appointed by the Financial Accounting Foundation, not the FTC. Option D is incorrect as members of the FASB must sever ties with any firms they were previously employed with before joining the board.

Which of the Following Statements Is True of the Financial