We are honored to have Robert Herz, Chairman of the FASB, join us for office hours on Tuesday, May 5th at 4pm.  Details about getting to office hours are here.  I am sure we all have good questions to ask him.  Here are mine:

General Issues

ORGANIZATION OF THE FASB.  Effective July 1, 2008, the FASB changed the FASB’s agenda-setting process to a “leadership agenda process” whereby the FASB chair is vested with the authority, following appropriate consultation, to set the FASB project plans, agenda and priority of projects.  How has this changed the operations of FASB?  Has this been more effective getting FASB to consider topics you want them to consider, or in putting a hold on topics that you would prefer not be considered.

OUTSIDE POLITICAL PRESSURE.  The last few months have seen a great deal of saber-rattling from Congress, including some hearings on fair-value accounting, and introduction of a bill sponsored by Rep Ed. Perlmutter (D-Colorado) “To establish the Federal Accounting Oversight Board to approve and oversee accounting principles, ”  which has since been referred to the House Financial Services Committee.  What affect has this pressure had on deliberation and/or agenda-setting, and what do you see as the long-term outlook for the FASB.

INTERNATIONAL CONVERGENCE.  Now that the FASB has provided its comment letter on the SEC Convergence Roadmap, do you care to hazard any predictions on what will happen, and how it will affect the FASB?

ROLE OF RESEARCH IN DELIBERATIONS.  At a presentation I gave this most recent weekend, a researcher asked me “Can you point to one aspect of a standard that was influenced by academic research.”  I would probably ask the question less pointedly, but would love to hear your thoughts on what research has influenced deliberation, and what academic researchers can do to be more helpful.

Particular Projects

FAIR VALUE ACCOUNTING.  Everyone is going to want to know where you stand on fair-value accounting in general, and what you see as being the future direction of fair value standards.   A few specific questions I would ask are:  Are you less comfortable having fair value applied to liabilities than to assets (with resulting gains for declines in creditworthiness)?  Do you see fair value being expanded to nonfinancial assets?  Do you anticipate decoupling of financial accounting standards and bank regulation?

FINANCIAL STATEMENT PRESENTATION.  The comment period on the Discussion Paper on Financial Statement Presentation just ended.  Do you have a preliminary take on how that paper has been received?

REVENUE RECOGNITION.  Many academic opponents of fair value accounting have been pleased to see the recent Revenue Recognition discussion paper, which uses fair value in a relatively limited way, and is very contract-oriented.  What considerations led the Board to those conclusions?

Revenue Recognition invariably brings up questions on principles-based vs. rules-based standards, so I am sure you can expect questions on that topic.

EMISSION TRADING SCHEMES.  Congress is currently considering a cap-and-trade proposal that would have dramatic economic effects on a number of publicly traded companies.  This would appear to make emissions trading accounting an important issue.  However, the FASB recently put the Emissions Trading Schemes project on hold.  Why is that? Do you see any chance that FASB gets tangled in another hot-button regulatory issue (in this case, the energy bill)?