Identifying the Most Basic Sources of Disagreement Over Standard Setting

Reading Kothari, Ramanna and Skinner’s answer to the question “What Should GAAP Look Like?” makes me want to get a better handle on the different perspectives academics are bringing to their criticism of accounting standards and the standard-setting process.  This will probably be the first of several posts, and I want to start with the [...] Read more > >

Revenue Recognition and "Libby Boxes": Research Brainstorming Roundtable

Revenue recognition is one of FASRI’s key target areas for research over the coming year.   We are going to take a big step forward on Tuesday, October 6th, 4pm by laying out some possible approaches to research studies on RevRec.  We will be structuring our discussion around the key independent variables that researchers might have [...] Read more > >

Revenue Recognition and “Libby Boxes”: Research Brainstorming Roundtable

Revenue recognition is one of FASRI’s key target areas for research over the coming year.   We are going to take a big step forward on Tuesday, October 6th, 4pm by laying out some possible approaches to research studies on RevRec.  We will be structuring our discussion around the key independent variables that researchers might have [...] Read more > >

Help Us Improve FASRI's Roundtables and Blog!

Click this link for a very short survey about FASRI’s Roundtables and Blog.  The fact that you are reading this means you are part of our sample universe.  It only takes a few minutes and will be a huge help.  Thanks! Read more > >

Help Us Improve FASRI’s Roundtables and Blog!

Click this link for a very short survey about FASRI’s Roundtables and Blog.  The fact that you are reading this means you are part of our sample universe.  It only takes a few minutes and will be a huge help.  Thanks! Read more > >

JAE Conference Readings: PhD in a Box

This weekend is the JAE conference.  Even if you weren’t invited, you can download the papers from the conference website.   These will undoubtedly be highly cited papers, and form the basis for PhD seminars comprehensive exams for years to come…but they are LONG! I am printing them out as I write this.  The six papers [...] Read more > >

Much of What We Publish Is Wrong…Even More, If It's About Fair Value

That would be the implication of this research study, which makes a fairly simple statistical point.  We already know that papers are more likely to be published if they include a positive result (they reject the null).  Less politically correct to admit is that when the data gets messy, researchers tend to make a lot [...] Read more > >

Much of What We Publish Is Wrong…Even More, If It’s About Fair Value

That would be the implication of this research study, which makes a fairly simple statistical point.  We already know that papers are more likely to be published if they include a positive result (they reject the null).  Less politically correct to admit is that when the data gets messy, researchers tend to make a lot [...] Read more > >

Financial Innovation and Blame

A very interesting set of posts on ‘Economics of Contempt’ on financial innovation and credit rating failures.  A few key points: Disclosure was good enough to make AIG’s exposure to Credit Default Swaps well-known.  The real problem, according to this anonymous structured finance lawyer, was that the ratings on lower-tier tranches became increasingly generous over [...] Read more > >

Get ready for earlier revenue recognition (and more estimation)

Are you ready for earlier revenue recognition (and more estimation)?  The FASB approved an EITF consensus (issue 08-1) this week in which the EITF dropped one of the key requirements that often precluded revenue recognition for delivered items in a multiple-element arrangement (think Apple and iPhones). In current accounting standards (EITF 00-21 or FASB Accounting [...] Read more > >

Virtual Worlds Conference on LIVE Page

I am in the San Jose airport leaving the Engage! Expo, a 2-day conference on Virtual Worlds.  It turns out that the technology we are using for FASRI is pretty popular, and as a favor to some friends, we are letting them use our LIVE page to stream a conference at Sun Microsystems.  Just click [...] Read more > >

Financial Statement Presentation Decisions

FASB made some decisions on Financial Statement Presentation on Wednesday.  Here is part that is related to FASRI’s research study, presented two days earlier: The Board decided to retain an approach to classification within the business section that is based on how a reporting entity organizes its activities and how it uses its assets and [...] Read more > >

Yes, Virginia: Recognized Information is Viewed as More Reliable

I presented FASRI’s report on Financial Statement Presentation to the IASB (last Thursday) and to the FASB (yesterday).  The report is based on an experiment conducted with Frank Hodge, Pat Hopkins and Kristi Rennekamp.  Several Board members seemed pleasantly surprised by the ability of the research to address the issues being deliberated, and are clearly [...] Read more > >

Yes, Virginia: Recognized Information is Viewed as More Reliable

I presented FASRI’s report on Financial Statement Presentation to the IASB (last Thursday) and to the FASB (yesterday).  The report is based on an experiment conducted with Frank Hodge, Pat Hopkins and Kristi Rennekamp.  Several Board members seemed pleasantly surprised by the ability of the research to address the issues being deliberated, and are clearly [...] Read more > >

What makes a component of income SPECIAL?

  I thought we had a great discussion last Wednesday  regarding the link between revenues and expenses.  For those who could not attend, you can listen to the archive session.   One of the key results in the Donelson, Jennings, and McInnis paper is that the special items component of earnings has increased recently, and this [...] Read more > >

SEC Concerned about Race to Bottom

The question of whether competition among standard setters leads to improved, high-quality reporting is an oft-debated topic and one that has come up on the FASRI research blog before (you can read the extensive commentary that topic induced here).  While academics might disagree, the SEC has already clearly voiced their concern about competition inducing a [...] Read more > >

Round Table Discussion on SMEs, FIN 48, and Private Company Reporting

On Tuesday, Sept 22nd, 4 pm ET, we will be joined by Paul Glotzer. Paul is a project manager at the FASB and has extensive experience working with small companies.  He is also the key liaison with the FASB’s new advisory group, the Private Company Financial Reporting Committee, and is currently working on, among other [...] Read more > >

University of Texas in Second Life

We have a strong University of Texas presence at FASRI Round Tables (Lisa Koonce and Nick Seybert are UT faculty and regulars at FASRI; Jeffrey Hales, FASB research fellow, is a former faculty member at UT; and this week’s presentation is by the UT faculty trio of Dain Donelson, Ross Jennings, and John McInnis).  However, [...] Read more > >

Did you see this in the New York Times? Blame the accountants

It seems odd that the finger pointing doesn’t stop.  http://finance.yahoo.com/banking-budgeting/article/107711/accountants-misled-us-into-crisis.html Read more > >

More on Litigation-Related Disclosures and Working with the FASB on Research

Yesterday (September 10, 2009), Rob Bloomfield posted regarding a legal perspective on FASB Accounting Standards Codification Topic 450 (FAS 5 – Accounting for Contingencies) and proposed changes in the disclosure rules for litigation-related contingencies.  This post relates to both the FAS 5 issue as well as an earlier discussion regarding conducting research with the FASB. While [...] Read more > >