What is the Post-Implementation Review (PIR) process?
Completed PIR ProjectsMore information on FASB and GASB standards that were reviewed by the FAF’s Post-Implementation Review team can be found here.
PIR ObjectivesThe PIR process has three main objectives:
- To determine whether a standard is accomplishing its stated purpose
- To evaluate the selected standard’s implementation and continuing compliance costs and related benefits
- To provide feedback to improve the standard-setting process (as opposed to recommending standard-setting actions).
- The standard resolved the issues underlying its need
- Decision-useful information is being reported to, and being used by, investors, creditors, and other users of financial statements
- The standard is operational: that is, stakeholders are able to apply the standard as intended, the standard is understandable, and preparers are able to report the information reliably
- Any significant unexpected changes to financial reporting or operating practices resulted from applying the standard
- Any significant unanticipated consequences resulted from applying the standard.
- Implementation and continuing compliance costs are consistent with the costs that the Board considered and stakeholders expected
- Benefits are consistent with what the Board intended and stakeholders expected.
The PIR Process and Procedures 2010-2017The PIR process is performed by a dedicated PIR team. The PIR Director reports to the FAF President and CEO and to the Trustees’ Oversight Committee. The PIR Director supervises the day-to-day activities of other Review staff. The Team includes experienced members of the Standards Boards’ staffs who have been released to the FAF to devote full-time efforts to the PIR function.
The PIR activities and procedures are independent from the activities of the Standards Boards and technical staff. The FAF by-laws require that standard setting be independent and objective, including independence from the Trustees’ influence.
Therefore, PIR reports on reviewed standards will not include standard-setting recommendations. Nevertheless, the PIR team discusses its procedures, research results, and conclusions (collectively, Findings) with the respective Standards Board’s members, who may make standard-setting action in response to technical matters indicated in the PIR findings.
The PIR team uses the following procedures to review FASB and GASB standards. The procedures may vary depending on the circumstances.
- Review of project archives
- Academic and other research
- Stakeholder input via surveys and interviews
- After completing the research, the PIR team compiles the procedures, research results, and conclusions into a Findings document, which is reviewed by the respective Standards Board’s Chair as well as the Oversight Committee.
A document further detailing the current PIR process and procedures (as of January 2017) can be accessed here, and a FAQ document on the process can be accessed here. Prior versions of the PIR Process description document can be found here.
PIR changes approved 2020The Board of Trustees of the Financial Accounting Foundation (FAF) has adopted improvements to the Post-Implementation Review (PIR) process for new accounting standards created by the Financial Accounting Standards Board (FASB) and the Governmental Accounting Standards Board (GASB). The FAF is the organization that appoints and oversees both Boards.
Under the improved approach, leadership of future PIR projects will transition from the FAF staff (supported by the Boards) to the Boards themselves, with continued strong oversight by the FAF Board of Trustees. With this approach, the PIR process will now be embedded in the Boards’ overall standard-setting process. As such, field data gathered as part of the FASB and GASB’s existing extensive post-issuance and post-implementation activities with stakeholders will be integrated directly into the PIR. The FASB and the GASB will report on the progress of PIR projects during their public meetings and will report regularly to the Standard-Setting Process Oversight Committee (SSPOC) of the FAF Board of Trustees. The final PIR report will be reviewed by the SSPOC and published on the FAF website.
A document further detailing this process can be accessed here.
For More Information Contact UsKim Petrone
FAF Chief of Staff