Revenue Recognition, Red Flags and The Mission of the FASB

Tom Selling has a few interesting posts on The Accounting Onion.  First, he takes a careful look at troublesome Revenue Recognition practices at Apollo Group, the parent company of University of Phoenix.  He also provides a broader list of red flags that analysts should add to their repertoire.  These are useful posts for academics, with [...] Read more > >

Teaching DIT’s this term? Did you know??

From a Credit Suisse First Boston report From a Credit Suisse First Boston report By David Zion, Amit Varshney, and Christopher Cornett Spinning Losses into Gold November 12, 2009 Last Friday President Obama signed into law the Worker, Homeownership and Business Assistance Act of 2009, which among other things contains an amendment that would temporarily [...] Read more > >

Professional judgment in financial reporting

In my technical accounting research class and in recent consulting work, I often have been reminded of the need for reasoned judgment in our profession. With the general move toward more objectives-based standards (using the SEC parlance), the need for professional judgment only will increase.  Recognizing the need to teach and understand what professional judgment [...] Read more > >

Leisenring: IFRS 9 Abuse “Inevitable”

Somehow I ended up on the mailing list of Risk.Net, which hails itself as “The world’s leading monthly magazine dedicated to the risk management and derivatives industries.”  In this week’s top story, headlined “Abuse of revised IFRS standards “inevitable” – IASB’s Leisenring“, Jim is quoted as expressing concern about using management intent to determine how [...] Read more > >

Happy New Year (in Principle)

I hope everyone is refreshed and ready for the new year — and a challenging one it will be for standard setters, with the convergence deadlines rapidly approaching.  To get you started, here are some thoughts on Principles vs. Rules, from Paul Miller and Paul Bahnson, academics who have a regular column (The Spirit of [...] Read more > >

Holiday Reading from FEI

It isn’t too surprising that the FASRI blog has been quiet, and it surely will be for another week or so.  There will be some interesting changes and improvements to the site when you return from vacation (I’ll keep you in suspense for now). But if you need your fix of accounting information and commentary, [...] Read more > >

Common sense and no right answers

In one of our discussion groups at the FASB’s Financial Reporting Issues Conference, we had a lengthy discussion about whether a lease represented the promise to transfer a bundle of rights (which could be satisfied at contract signing) or the promise to allow someone to use an asset for a fixed period of time (which [...] Read more > >

Great article by Floyd Norris

My colleague John McInnis at Texas alerted me to this article. Very good stuff.   I wonder how much will come back on the balance sheet with the new rules that go into effect in Q1 of 2010.  I have read that Citibank expects (don’t have figure handy) a relatively small portion to come back on [...] Read more > >

FASB/IASB Conference takeaway

Having recently attended the FASB/IASB issues conference on revenue recognition, leasing (lessor), and insurance, I was struck by how terminology gets in the way.  For example, figuring out what “unit of account” might mean seems to be something many debates were centered around … yet there’s not a definition of this notion.  So much of [...] Read more > >

An Option Play

Sorry for the light blogging, but I have been preparing for the upcoming Financial Reporting Issues Conference.  As always, the cases are a real challenge.  Here are a few questions to ponder: If I write an option, can it possibly be an asset?  Before you instinctively answer “of course not” (after all, you have given [...] Read more > >