When the IASB and FASB began the convergence process in 2002, they considered R & D as a high-priority project, where differences between US GAAP and IFRS were seen as particularly straightforward. However, as this article notes, still no consensus has been reached because IASB’s R&D treatment appears to defeat comparability in the eyes of… Read more »
Posts Tagged: Financial Statement Analysis
Donated Inventory
Over the next five years, Wal-Mart plans to donate about 1.1 billion pounds of food to food banks and provide $250 million to help them buy refrigerated trucks, improve storage and develop better logistics. The plan to contribute $2 billion in cash and food to the nation’s food banks is considered to be one of… Read more »
Financial Instrument Accounting
On Wednesday, May 26, 2010, the FASB released an exposure draft for the purposes of improving accounting for financial instruments. The new rules, projected to take effect in 2013, incorporate both amortized cost and fair value information about financial instruments held for collection or payment of cash flows. Questions: 1. According to the article, how… Read more »
Convergence Delayed
The head of the Financial Accounting Standards Board, which sets U.S. accounting rules, said June 1, 2010, that he does not expect FASB to meet a June 30, 2011 deadline for convergence with international accounting rules, as requested by the G20 group of industrial and emerging countries. According to FASB chairman, Robert Herz, changes that… Read more »
Bond Rating Under Fire
E-mails and other documents were presented as evidence at a hearing examining the causes of the financial crisis on Capitol Hill on April 23, 2010. This hearing is part of an 18-month investigation by the Senate Permanent Subcommittee on Investigations, led by Senator Carl Levin. Subcommittee assertions are that the rating agencies were well aware… Read more »
Frequent Flyer Miles
If the merger is approved, United Airlines and Continental Airlines will also be merging their frequent flyer programs. But what is their track record in terms of rewarding the miles versus actual requests? Consulting group, IdeaWorks Company, said Continental awarded free tickets 71 percent of the time in response to requests, and United 69 percent… Read more »
FASB Sued for Intellectual Property Infringement
Joel Jameson, the founder of Silicon Economics, Inc. is suing the FASB. He filed for a patent for his invention called “EarningsPower Accounting,†and claims that the FASB has infringed upon the patent. Jameson claims that his invention is a patented method developed by the company to improve the accuracy, validity, and usefulness of financial… Read more »
Sarbanes-Oxley Benefits without Cost
Many have debated the cost of Sarbanes-Oxley (SOX) versus its benefits, given the recent accounting scandals that continue to “pile on”. However, according to Harvard Business School professor, Francois Brochet, the little discussed 2002 provision known as Section 403 is actually making a difference for investors and small companies (and with little cost, unlike some… Read more »
What’s the Diagnosis – Accounting Fatigue Syndrome (AFS)?
At a recent conference in Orlando, financial executives discussed one of the top reasons for employee fatigue – a continuous stream of regulatory and accounting standard-setting guidance that has been issued in recent years and the promise of more to come over the foreseeable future. Questions: 1. Although the article provides little detail, what accounting… Read more »
Fighting Back Against Payday Lenders
Wisconsin lawmakers agreed on Thursday, April 22, 2010, to regulate payday lenders. Wisconsin had been the only state not to regulate this industry, which consumer advocates said allowed its rapid growth and trapped too many borrowers who take out short-term loans with high interest rates in a cycle of debt. Questions: 1. What were some… Read more »