in this video we're going to discuss the emerging issues Task Force which is otherwise known as the EIT F so the EIT F was created by the Financial Accounting Standards Board in 1984 and if you remember the FASB is the organization that's in charge of making the Accounting Standards for the US so the FASB makes US GAAP and they've created this Eid F to help out and what the EIT F helps out with is situations where we have a diversity in accounting practice and what I mean by diversity is this you all have two firms
accounting for the same transaction in a different manner and so what the FASB did it said okay we're going to create this task force and what they're going to do is they're going to look at issues where there's a diversity of treatment and they're going to see if there's some way to provide some guidance within the existing accounting standards codification about how that transaction should be properly accounted for and what I mean by that is this when I talk about the existing framework they're trying to say okay look is there a way that we can
come to a consensus this task force can reach a consensus and say look this is the proper way to be accounting for this transaction without the FASB having to get involved in issuing a new accounting standard okay so basically the FASB they are going to be able to focus more on long term projects whereas the eitf can focus on short term projects so that's the idea and that's why the FASB created the eitf now the members of the eitf are appointed by the FASB and typically the members of the eitf they work at large firms
in many cases it's large accounting firms but it doesn't have to be there's been people from Google and so forth who are members of the eitf in addition you so you've got the members of the ITF but when you're having a knee ITF meeting or discussion you can also have people from the SEC or the FASB there as well to participate and take part in the discussion for example usually the chief accountant for the SEC will attend the meeting the faz of the FASB board members could attend to me eating so there's a large number
of people that can take part in these discussions not just the eitf and what the ultimate goal is what the EFT ITF is trying to accomplish is they're trying to come up with a consensus solution a solution that we can come up with and we say all right look we've looked at the issues there's a diversity of practice and so we've come up with a consensus on the way that we should the firm should be doing the accounting here's how they should be doing it so the FASB doesn't have to come in and say all
right now we're going to have a long project trying to figure out this and then coming up with an accounting standard so really it's like the eitf is putting out fires so that they don't have to come to the attention of the FASB and the nice thing is so the sec whatever decision whatever consensus that the eitf is able to reach the sec will respect that as if that's the preferred accounting treatment so it's saved the FSA FASB a lot of trouble
