| Sarbanes-Oxley requires that funding for
the FASB be from assessment of annual dues on public companies and accountants,
not from contributions from sponsoring agencies and others, as had been
the case prior to the passage of this legislation.
The purpose of this action was to increase the indenpendence of the FASB from the constituents it serves, but increases the dependence on the SEC. Now, the SEC potentially controls the FASB's funding by its recognition. The SEC must recognize the FASB as the accounting standards setter; if not recognized by the SEC, the FASB cannot assess the fees required for its operations. |