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What is the difference between Regulation and Promulgation?

Updated on June 22, 2017

Promulgation, in general sense, means a formal statement that will be announced publicly. Based on Law, it says an official announcement of any new policies, laws or ordinances wherein this will be implemented immediately or place into effect. In other terms, it is also known as proclamation, notice, announcement, memorandum or advisory.

In the Accounting sense, it means any declarations or statements of changes in principles or having new standards with regards to accounting. These new criteria and modifications should be implemented immediately. However, before the promulgation of such policies or rules, they should seek first approval by the majority of the concerned individuals. Several factors will be considered before a regulation or standard will gain its approval. One example of an organization seeking the promulgation of concept-based policies of accounting is the American Accounting Association.

As times passes, new standards and changes cannot be avoided somehow. Such new regulations should be analyzed, approved and promulgated. They might be based on the principle of accounting and any diversity that is needed to be considered. One example of the regulation is the Regulation S-X. According to the Securities and Exchange Commission or SEC, Regulation S-X pertains to a detailed layout and substance of financial statements. It also requires organization or any business enterprise to provide securities to the people to support enough disclosure.It is intended for the investors so that they can assess the qualities of their concerns and other issues

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