During which step of the FASB process is a public hearing held?

The holding of a public hearing occurs during the third step of the FASB process, which is an important part of the standard-setting procedure. This step is critical because it allows stakeholders—including investors, practitioners, and industry experts—to provide feedback on the proposed accounting standards. By conducting a public hearing, the FASB ensures that various perspectives are considered, enhancing the quality and practicality of the final standards. This input can lead to modifications and improvements to the proposals based on real-world applications and concerns. The third step is, therefore, a key moment for gathering diverse input before the standards are finalized, reflecting the FASB's commitment to transparency and stakeholder engagement in the standard-setting process.