Saying No in Standard Setting : An Examination of FASB Board Members’ Voting Decisions

More than half of the 163 Statements of Financial Accounting Standards issued by the Financial Accounting Standard Board (FASB) between 1973 and 2007 were passed with dissenting votes. In this study, we investigate the factors associated with FASB board members' decision to dissent. We find that board members with preparer and academic backgrounds are more likely to dissent compared to those with a public accounting background, and the impact of board members' professional backgrounds varies by the type of issues the accounting standards address. Our results also show that military experience and educational background are associated with the likelihood of dissent. In addition, we find that younger board members and those at the end of their term are more likely to dissent, perhaps to signal a different point of view. Finally, our analyses of board members' written dissenting opinions show that professional backgrounds are associated with different perspectives in how board members evaluate an accounting standard