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NEW QUESTION: 1
Which of the following statements best describes an operating procedure for issuing a new Financial
Accounting Standards Board (FASB) statement?
A. The emerging issues task force must approve a discussion memorandum before it is disseminated to
B. A new statement is issued only after a majority vote by the members of the FASB.
C. The exposure draft is modified per public opinion before issuing the discussion memorandum.
D. A new FASB statement can be rescinded by a majority vote of the AICPA membership.
Choice "c" is correct. A new statement from the FASB is issued only after a majority vote of the members
of the FASB.
Choice "a" is incorrect. There is no necessity for the EITF to approve a discussion memorandum
(presumably the question means a discussion memorandum of the FASB statement itself and not an EITF
statement) before it is disseminated to the public.
Choice "b" is incorrect. There is no necessity for an exposure draft to be modified per public option before
issuing the discussion memorandum (a question can be raised here as to "what" discussion
memorandum"). Exposure drafts are quite/most often modified before they are issued as FASB
statements, but they do not have to be. Whether they are or are not modified is a function of whether the
FASB thinks they should be modified, partly due to the public comments that have been received.
Choice "d" is incorrect. There is no way to rescind a new FASB statement, although, in reality, a FASB
statement can be rescinded by the issuance of a new statement on the same subject. However, even if
there was a way to rescind a new FASB statement, it would not be by a majority vote of the AICPA
membership, but by a majority vote of the members of the FASB. Reporting Net Income