posted on 06-06-2019

Accounting Research Bulletins (ARB)

Updated August 8, 2020

What are Accounting Research Bulletins (ARB)?

Accounting research bulletins (ARBs) are publications from the Accounting Principles Board of the American Institute of Chartered Public Accountants.

How Do Accounting Research Bulletins (ARB) Work?

ARBs recommend accounting procedures. The oldest date back to 1938, and 42 were issued between 1939 and 1953. Most are the result of research by the Committee on Accounting Procedure in areas where problems were most prevalent and where businesspeople were most concerned.

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 open account balances, security holdings, sales 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 gain or loss on transactions among the companies in the group. Accordingly, any intercompany profit 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 Do Accounting Research Bulletins (ARB) Matter?

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 Accepted Accounting Principles (GAAP), a framework of accounting standards, rules and procedures defined by the professional accounting industry.