Accounting Research Bulletins (ARB)
What it is:
research bulletins (ARBs) are publications from the Principles Board of the American Institute of Chartered Public Accountants.
How it works/Example:
Here is an example of the text from ARB 51: Consolidated Financial Statements: "CONSOLIDATION PROCEDURE GENERALLY. In the preparation of consolidated statements, intercompany balances and transactions should be eliminated. This includes intercompany account balances, security holdings, and purchases, interest, dividends, etc. As consolidated statements are based on the assumption that they represent the financial position and operating results of a single business enterprise, such statements should not include or loss on transactions among the companies in the group. Accordingly, any intercompany or loss on assets remaining within the group should be eliminated; the concept usually applied for this purpose is gross profit or loss. (See also paragraph 17.)"
Why it matters:
ARBs are not binding rules in themselves (because they are more like interpretations of existing rules), though the SEC typically requires companies to follow them via Generally AcceptedGAAP), a framework of standards, rules and procedures defined by the professional accounting industry.