The US Financial Accounting Foundation (FAF) announced today that the Financial Accounting Standards Board (FASB) will grow from five to seven members. In addition, FASB chairman Robert Herz announced his retirement after more than eight years. FASB was operated as a seven-person team from 1973 until 2008, when it reduced its members to five.  FAF's said the transition back into the old structure is expected in early 2011, as soon as the process to recruit and evaluate candidates is complete. "Returning the board to the seven-member structure will enhance the FASB's investment in the convergence agenda with the International Accounting Standards Board (IASB), while addressing the unprecedented challenges facing the American capital markets in the months and years ahead," said FAF chairman Jack Brennan. Leslie Seidman will succeed Herz as acting chairman beginning Oct. 1. Seidman has been a member of FASB since July 2003. Prior to joining the board, she managed her own consulting firm and previously served as vice president of accounting policy at JP Morgan. The board's primary function is to establish standards of financial accounting and reporting in the private sector through out the US. Those standards govern the preparation of financial reports and are officially recognized as authoritative by the Securities and Exchange Commission (SEC) and the American Institute of Certified Public Accountants. The Chairman of the Securities and Exchange Commission (SEC), Mary Schapiro commended the announcement, saying that it proved an on going effort from the FAF to " evaluate and improve the effectiveness and efficiency of the structure and operation of FASB." "In addition," she added, "this should enhance the ability of the FASB to address issues facing the U.S. capital markets and the needs of investors." The FAF is responsible for the oversight, administration and finances of both the FASB and the Governmental Accounting Standards Board. Write to Christine Ricciardi.