The Role and Purpose of a FASB Technical Bulletin

A Financial Accounting Standards Board (FASB) Technical Bulletin was a form of guidance providing timely clarification on financial accounting issues not explicitly covered in existing standards. These bulletins explained or elaborated on existing accounting principles to ensure consistent application. They addressed narrow problems by interpreting existing standards, rather than establishing new accounting principles.

Role and Authority in GAAP

The authority of accounting guidance in the United States is determined by its place in the Generally Accepted Accounting Principles (GAAP) hierarchy. Historically, FASB Technical Bulletins were classified as Level B guidance. This placed them below FASB Statements of Financial Accounting Standards (SFAS), which were Level A, but above other forms of guidance.

This distinction in authority meant a Technical Bulletin’s role was strictly interpretive. For example, it could provide specific direction on how to apply a broad principle from an SFAS to a particular transaction or industry practice, but it could not introduce a new accounting principle or amend an existing one.

The FASB no longer issues new Technical Bulletins, and the guidance they contained was integrated into the FASB Accounting Standards Codification in 2009. The Codification is now the single, authoritative source for U.S. GAAP, where guidance from former bulletins carries the same authority as other content.

The Development and Issuance Process

A primary distinction of the Technical Bulletin process was that it was a staff-led initiative, allowing the FASB to respond to emerging accounting questions more quickly than by issuing a full standard. The process was designed for issues needing timely clarification that did not warrant the extensive due process of creating a new standard.

To be addressed by a Technical Bulletin, an issue’s proposed guidance could not cause a major change in accounting practice or conflict with existing GAAP principles. This ensured the bulletins remained a tool for implementation guidance, not for setting new policy.

Though streamlined, the process involved due process. FASB staff would analyze an issue, draft a proposed bulletin, and present it to the Board. The proposal was then released for public comment. After reviewing feedback, the staff presented the final bulletin to the Board, which could be issued if a majority of members did not object.

Structure and Application of a Technical Bulletin

The format of a Technical Bulletin was often a series of questions and answers, making the guidance accessible to accountants. A bulletin would begin with a “Background” section that laid out the accounting problem and the relevant existing standards that did not fully address the situation.

Following the background, a “Question” section would state the specific issue. The “Response” or “Conclusion” section provided the FASB staff’s official guidance on how to account for the transaction or event in question.

For instance, an accountant unsure how to account for a specific government grant could consult a relevant Technical Bulletin. They could read the background to confirm it matches their situation and find a direct question about the grant. The response would then provide the specific accounting treatment, such as the criteria for recognizing the grant as revenue.

Accessing Technical Bulletins within the FASB Codification

Accountants today do not consult standalone Technical Bulletins, as they are historical documents. All authoritative guidance, including content from these bulletins, is housed within the FASB Accounting Standards Codification. The Codification is the single source for U.S. GAAP for nongovernmental entities, organizing all principles into a single, searchable database.

The Codification is structured by topic, subtopic, section, and paragraph. When navigating the Codification, a user can often find information on the original source of the standard. This means a user can see if a rule originated from a Technical Bulletin, an SFAS, or another source.

This sourcing information is useful for historical context but does not change its authority, as all guidance within the Codification carries equal weight. An accountant would search the Codification by topic to find the relevant rules, not search for the historical bulletin itself.