Accounting and Civilization

I know that many of you are preparing to teach soon, and your students might not fully appreciate the importance of your subject matter:  accounting.  You might start by talking about accounting’s crucial role in the development of writing, and civilization itself.  Attendees of the AAA meetings from several years ago might have seen Denise [...] Read more > >

Convergence, Condorsement and Carve-in – Insights from SEC Roundtable

The SEC hosted a Roundtable on IFRS July 7.   I turned on the archived webcast in the background as I worked through my email stack.  The discussions seemed similar to a roundtable the FASB held near the end of my term as Fellow.  But I did catch a few new words. Condorsement – Jeremy [...] Read more > >

A new dimension to disclosure reform

One of the questions around the disclosure framework is how the FASB will coordinate with the SEC and IASB. One issue that may make this question even more interesting is that a new group has potentially inserted itself in the discussion. Last month, the PCAOB released a concepts statement outlining proposed revisions to the auditor [...] Read more > >

Round Table: Harry Evans, Senior Editor of The Accounting Review

Click on “read more” at the bottom of this post and then click here for an archived recording of the session and click here for Harry Evans’ slides. The FASRI Round Table series continues at 4pm Eastern time on Tuesday, July 19. Rob Bloomfield, Lynn Rees and Phil Shane will moderate the session, and our guest [...] Read more > >

Disclosure project continued…

The FASB’s current Disclosure Framework Project was initiated in response to recommendations from various investor groups and the SEC Advisory Committee. One of the groups to reach out to the FASB was the Investors Technical Advisory Committee. In reading through their 2007 letter, they state as part of their rationale: “In our view, our proposal [...] Read more > >

Pensions, OCI, and intangibles

This post relates to some prior threads.  Its main basis is the IASB’s amended pension guidance (Phil’s post).  It is also about what goes to OCI (my post).  And finally it considers another type of intangible that may or may not be an asset (Jeff W’s post). My curiosity is how the new IASB guidance [...] Read more > >

EBITDAP and other pension “magic”

The Dow was at about 14,000 during October-November 2007 and at about 7,000 in February 2009. This resulted in losses in many companies’ pension funds. Many companies had unrealized losses exceeding the 10% corridor boundary, which meant the “excess” losses had to be gradually amortized into pension expense under U.S. GAAP.  For example, in 2009-2010 [...] Read more > >

Researchers Make Suggestions for Lessor Accounting

I have been reading a recent paper by Mark Bauman (Univ. of Northern Iowa) and Richard Francis (Univ. of Texas – El Paso) published in Accounting Horizons (June 2011) on the topic of lessor accounting. For those academics who follow this standard setting topic, you already know there is a relative dearth of research that [...] Read more > >

Questions for Bob Herz at the AAA Meetings

Hopefully, you have all heard by now that the Monday morning plenary speaker in Denver at the AAA Meetings is Bob Herz, former Chair of the Financial Accounting Standards Board. The format of his presentation will be slightly different from the traditional format. That is, Mr. Herz has agreed to address questions that have been [...] Read more > >

SEC Roundtable on IFRS

On Thurs, July 7, the SEC will hold a roundtable on International Financial Reporting Standards. The agenda (available here) looks to cover aspects of the Work Plan with particular emphasis on investor, small company, and government preparedness. The event will be webcast and is scheduled to run from 10 am to about 4 pm in [...] Read more > >

Great teaching case — is it a derivative or not?

A Tuesday June 28th Financial Times article entitled “Accelerated Buy-Backs Make a Comeback” indicated that companies were using excess cash to buy back their own stock. Rather than the traditional buy back process (where a broker buys back the company’s stock .. on behalf of the company), the company is accelerating the buy back. What [...] Read more > >

What is Financial Statement Comparability?

As with many terms in financial reporting, the term comparability means different things to different people. Recently, I’ve read a number of papers that shed academic light on financial statement comparability, which means that the researchers had to define what they mean by comparability and then select an appropriate proxy for that construct. In this [...] Read more > >

Pervasive Evidence

Current revenue recognition criteria are easy to talk about in class but coming up with concrete examples, using companies that students have heard of has always been challenge for me. Well not any more. A recent Accounting Onion post highlighted a great example of an issue with the criteria requiring pervasive evidence of arrangement before [...] Read more > >

Favorite OCI Item Anyone?

Other Comprehensive Income has appeared in a couple of different posts recently.  It plays a role in pension accounting (see “is it time to fix accounting for pensions”).  The blog also reported that the FASB recently restricted the potential methods for disclosing OCI. The latter post raised some general questions about distinctions between net income [...] Read more > >

A Little Discretion Here, A Little Discretion There

Lease accounting has received a lot of attention recently, given the fairly substantial changes being proposed by the FASB and the IASB in their joint project on lease accounting. One area of lease accounting that hasn’t raised as much discussion is how to account for short-term leases (i.e., leases with terms of less than one [...] Read more > >

Is it time to “fix” accounting for pensions?

On June 16, 2011, the IASB released its amendments to IAS 19 (Employee Benefits).  David Zion, accounting research analyst for Credit Suisse, reviews the implications of the amendments and concludes that “now it’s FASB’s turn” to “fix” pension accounting. In fact, he recommends that the FASB simply expose the new IASB rules, as is, to FASB [...] Read more > >

More on Disclosure

I told a brand new PhD student here at The University of Texas, Greg Capps, about my regular blogging on the FASB disclosure project. He had an interesting story to tell me. He said… “In my auditing days, perhaps the worst thing we did to a client was hand them the 250-page GAAP Disclosure Checklist [...] Read more > >

Accounting quality and backdoor listing

I got an email alerting me to an interesting news item from Bloomberg.  The story discusses how some Chinese firms become publicly traded in the U.S. but would not qualify to be listed in Hong Kong.  The story mentions that 98 Chinese companies used “reverse-merger” to get listed in the U.S.  “The MSCI China Index [...] Read more > >

Own Credit Risk

I have started to think recently quite a bit about firm’s own credit risk and I think it is an area research has the potential to be helpful to standard setting. Barth Hodder and Stubben (TAR 2008) investigate the association between equity returns and credit risk changes. Consistent with Merton (1974), the relation between credit [...] Read more > >

Sir David Tweedie is an “Accounting Rock Star”

…or so says The Economist in this article. While I generally think highly of the The Economist, this article contains one of my pet peeves, which is a loose discussion of fair value. In particular, the article states that “In 2009, under its previous chairman, Bob Herz, FASB narrowly voted 3-2 that all assets should [...] Read more > >