The State of Maryland has recently passed a law that allows the creation of for-profit “benefit” corporations that include in their charter a commitment to pursue goals other than profit maximization. As the Washington Post reports: These hybrid entities pay taxes and can have shareholders, without the risk of being sued for not maximizing profits. [...] Read more > >
Mark DeFond of the University of Southern California presented a paper here at UT-Austin last week. It is neat as it deals with a basic concept .. that is, comparability. HOW FUNDAMENTAL IS THAT? EXACTLY! VERY. Title of paper: The Impact of Mandatory IFRS Adoption on Foreign Mutual Fund Ownership: The Role of Comparability. He [...] Read more > >
From the Telegraph, and quoted without comment: Iain Richards, of Aviva Investors, told the Lords that the IFRS system of auditing the banks had had “a material cost to the taxpayer and to shareholders” because “as a result dividend distributions have been made and bonuses have been paid that were imprudent”. Mr Richards said: “The [...] Read more > >
From the FASB website: Financial Accounting Foundation Appoints Daryl E. Buck and R. Harold Schroeder to the Financial Accounting Standards Board Norwalk, CT, January 14, 2011—The Financial Accounting Foundation (FAF) today announced the appointments of Daryl E. Buck and R. Harold (Hal) Schroeder to the Financial Accounting Standards Board (FASB). Mr. Buck is currently Senior [...] Read more > >
JP Morgan sent around a report on a change in pension accounting at Honeywell last November. Honeywell had been following the traditional procedure of amortizing any accumulated pension gains or losses that lay outside of the corridor over the average remaining service life of employees. The company decided to stop amortizing – any gain or [...] Read more > >
Many papers have been written on the “kink” in the earnings distribution, which exhibits surprisingly few small negative realizations, and surprisingly many realizations at or just above zero. Let the financial reporting researchers argue about whether the kink is statistically robust or whether it reflects earnings management (operational or otherwise). Managerial accountants Indjejikian, Matejka, Merchant [...] Read more > >
Happy New Year! I’m back to blogging after a holiday hiatus, with a pointer to this article addressing the title question. The author, a law professor, says no. I say yes. If you think of evaluating a paper as an audit, knowing something about the author’s motivation is part of the inherent risk assessment, and [...] Read more > >
We have a unique opportunity to (hopefully) have some impact on the future of standard setting. The IFRS Foundation oversees the International Accounting Standards Board. The Foundation has issued a call for comments on its strategy review. Click here to see comment letters received to date and instructions for submitting a comment letter. This provides [...] Read more > >