<p>NORWALK, Conn.-In response to the Enron scam, the Financial Accounting Foundation (FAF) is considering streamlining the Financial Accounting Standards Board (FASB) to promote “a strong, transparent, and rigorous system” of accounting standards. The changes have been submitted for public comment for 30 days. “We have a responsibility to investors and we take it very seriously,” FAF Chairman Manuel H. Johnson commented. “The Trustees are committed to preserving the independence of private-sector standard setting and will continue to consider improvements to the process in as timely a manner as possible.” Included among the changes are: A reduction in the size of the FASB from seven to five members through attrition; A simple majority-voting requirement of 3-2 for the five-member board (The current board has a 5-2 supermajority requirement); and A recommendation to the FASB that it expose proposed standards for shorter comment periods. Comments also will be sought on the composition of a five-member board. The board currently consists of three members from public accounting, two from industry or preparers, one from the investor or user community, and one from the academic community. Results of the comment period will be discussed at the regularly scheduled April 23 meeting. The board of trustees met on January 17, 2002, and again on March 4, 2002, to discuss these issues and the changing regulatory environment. At the March meeting, the FAF also reviewed the importance of a private, independent accounting standards setter.</p>

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