How True or Fair is "True and Fair"?

One of the topics that came up in last week’s Round Table on Alternative Conceptual Frameworks was a discussion of the true and fair override. It came up when we were talking about one difference between US GAAP and IFRS being that Read more > >

Is Accounting’s Conceptual Framework Unique?

During today’s Round Table Discussion, an issue arose as to why (some, many?) accountants feel the need for a conceptual framework.  One contributor noted that Basu and Waymire have a paper that observes other business disciplines (e.g., marketing) do not appear to have conceptual frameworks.  Why accounting? Read more > >

Why Matching Is Out of Vogue

So far, no one has responded to my questions about the importance of contracts for revenue recognition. So, let me venture to ask a few more questions that occurred to me while reading the FASC’s comment letter on the revenue recognition discussion paper. In their response to Q9, the authors state: The traditional “income statement” [...] Read more > >


Following up on my last post, I had a very entertaining discussion with a Very Successful Accounting Researcher (VSAR) last week at the AAA meetings on the topic.  After VSAR criticized some decision or other of the FASB, I asked “Why do standard setters make such awful decisions?”  We were talking in a noisy room [...] Read more > >

Why Do Standard Setters Make Such Awful Decisions?

Everyone, it seems, likes to complain about the decisions of the FASB and IASB.  Some complain that the Boards are too beholden to the wishes of preparers, by allowing them to park debt off their balance sheets, hide volatile income numbers in the Statement of Changes in Shareholder’s Equity (rather than running through earnings), and [...] Read more > >

Round Table Discussion: Alternative Conceptual Frameworks

Tuesday, August 11th at 4pm we will be discussing two alternatives to the FASB’s Conceptual Framework Project. One is this document from by the AAA’s Financial Accounting Standards Committee, which Jeffrey has already written about.  I dissented from this document, primarily because it didn’t attempt to specify the objectives of financial reporting (you can read [...] Read more > >

Thinking about Alternative Conceptual Frameworks

The AAA’s Financial Accounting Standards Committee recently put together a proposal for an alternative conceptual framework. Conceptual frameworks (CF), by their nature, deal with such fundamental and far-reaching concepts that these types of intellectual ventures are bound to generate disagreement. This proposal is no exception, as evidenced by the dissenting opinions, and is not only [...] Read more > >

AAA FASC Weighs in on Revenue Recognition

The AAA Financial Accounting Standards Committee (FASC) recently submitted a comment letter in response to the FASB/IASB’s discussion paper on revenue recognition. This letter is unusual because it is one of few (if any others) that draw on existing academic research to support its arguments. In that regard, the FASC has provided a useful service [...] Read more > >

Securitization Yields a Big Turnout, Engaging Discussion, and Lingering Questions

Securitization certainly seem to be a hot topic!  We had a big turnout for yesterday’s Round Table Discussion, with over 20 people coming in-world for the discussion and even more than that streaming the event live from the web.  I think people were hoping to hear lots of informative and stimulating discussion and, if they [...] Read more > >

Bob Laux of Microsoft on Revenue Recognition, Comment letters, Fair Value…and General Motors

We had an excellent discussion today with Bob Laux of Microsoft. Whether you are looking for research topics or good stories for your students–financial or managerial–you will find this a very interesting discussion. You can now watch the archive live by going here, waiting through a 15 second commercial, and then clicking the “on demand” [...] Read more > >