GLG News by FASB 28: Sale-Leaseback Accounting Experts

Paul MillerProfessorREGENTS OF THE UNIVERSITY OF COLORADO

Truth is truth, whether it's welcome news or not

July 7, 2009

Analysis of:The Fair Value Deadbeat Debate Returns | www.cfo.com

Financial reporting works best, and maybe only, when it is complete and unbiased.  If it is biased to manage the message, it becomes a method of distributing propaganda and all credibility is lost.The economics of gain occurrence is unarguable.  If management can retire a debt for a smaller amount than the carrying value, then there are fewer liabilities and more equity.  More equity means income has occurred.  There is no rationality behind efforts to suppress truthful news just because you don't like it.  Let's all hope the standard setters are not swayed by "visceral" impulses into the direction of keeping useful information out of financial statements.  The inevitable consequence is greater risk and discounted share and bond prices, simply because users don't have access to the truth.  That does no one any good.

Paul MillerProfessorREGENTS OF THE UNIVERSITY OF COLORADO

Exacerbation or exposé?

October 13, 2008

Analysis of:Alls Fair: The Crisis and Fair-Value Accounting | www.cfo.com

undefined undefined Listen to the message and don’t shoot the messenger if you think it’s bad news. And don’t endorse public policies based on deceptive reporting. undefined undefined

Paul MillerProfessorREGENTS OF THE UNIVERSITY OF COLORADO

Is it bad reporting or does naivete reign at the highest levels?

August 7, 2008

Analysis of:Mulling the Fair Value, Historic Cost Choice | www.cfo.com

Maybe it's just me, but these quotes from Herz and Pozen are off-base. When they suggest there could be a pure historical cost system, they are talking about something that doesn't exist and hasn't existed in a 100 years, if even then. I have to believe that Herz was misquoted or misinterpreted; I can believe that Pozen would misunderstand. Nothing will come out of this. There will be no turning back to more costs. There will be a continuing progression toward fair value accounting for the simple reason that it produces the information that users want and that society needs them to have.undefined undefined

Paul MillerProfessorREGENTS OF THE UNIVERSITY OF COLORADO

Accounting for subprime investments: Denial is not a river in Egypt

April 7, 2008

Analysis of:SEC fails to douse debate over ‘fair value’ | www.ft.com

This article reveals the bizarre mindset of managers who (a) want to take huge risks for a shot at high returns, (b) don’t mind reporting results when they succeed, but (c) don’t want to report their losses. To put it another way, they want to invest in risky securities but report income from their ventures as if they put money into certificates of deposit. There is no legitimacy in twisting the accounting to cover up the results, and no reason to blame the chief accountant or FASB for the problem, or to expect the regulators to take them off the hook by allowing the losses to be hidden.

Ronald KiimaPresident Kiima Incorporated

Bush Nominates Two Democrats to SEC: More of the Same is Likely

March 31, 2008

Analysis of:White House to Tap Two Dems to SEC | www.cfo.com

Will President Bush's recent nomination of two Democrats to the SEC make it more investor friendly?  Not likely!

Ronald KiimaPresident Kiima Incorporated

2007 Accounting Error of the Year: Depreciation and Amortization

January 2, 2008

Analysis of:Securities Suits Spike in 2007 | www.cfo.com

The subject article provides some interesting insights into the upward reversal in the number of securities class-action lawsuits filed during 2007.  Given such, I thought it might be fitting to offer my personal insights into what I continue to believe is the most common, yet rarely noticed, accounting error. As in prior years, inappropriate depreciation and amortization methodologies once again gets my nomination for Accounting Error of the Year.  Unfortunately, absent some unforeseeable improvement in oversight by corporate auditors and the SEC, I suspect that I will again be making the same nomination this time next year.      

Paul MillerProfessorREGENTS OF THE UNIVERSITY OF COLORADO

Cash flow manipulation is real

October 29, 2007

Analysis of:Cash Flow Manipulation – Analyzing and Identifying | theharrissolution.com

You can never judge a book by its cover or a seminar by its flier, but Harris Solutions is on to something here.  If you have accepted the SCF as pure and not manipulable, you may very well want to attend to find out more about the sly maneuvers on the fringes of GAAP that pump up the operating cash flow.  A couple of examples appear below.

Paul MillerProfessorREGENTS OF THE UNIVERSITY OF COLORADO

Restatements are absolutely relevant and essential, without question

October 26, 2007

Analysis of:Post-Sarbox, Are Restatements Relevant? | cfo.com

Restatements are not triggered by Sarbanes-Oxley but are caused by management’s financial statement errors, either deliberate or inadvertent.  Thus, any arguments that restatements are unimportant are fatuous.  These opponents are asserting that it’s suitable public policy to allow managers to publish erroneous statements and then leave them that way. With regard to the lack of market reaction, the researchers face the persistent problem of figuring out when the market reacted.  It is unwise to assume the market doesn’t know about the errors until they’re announced with the result that it’s impossible to know exactly what the market reacted to.   As I see it, managers should embrace restatements as opportunities to clear the air of uncertainty that something in their statements is misleading.  They absolutely should not worry about the cost of restatements.  When compared with the potential effect on market cap, the out of pocket costs are negligible.     

Ronald KiimaPresident Kiima Incorporated

SEC Schedule II - Visibility into the Integrity of Reported Results

September 11, 2007

Analysis of:SEC Schedule II - Visibility into the Integrity of Reported Results | tinyurl.com

Few other disclosures give as much visibility into the integrity of a company’s reported results like the SEC’s Schedule II – Valuation and Qualifying Accounts. Unfortunately, despite such schedule being required of most public companies, few companies seemingly fully comply. The absence of otherwise required data, or worse, the outright omission of the schedule in its entirety, should raise investor concerns that a company may be engaging in some degree of inappropriate earnings management.

Paul MillerProfessorREGENTS OF THE UNIVERSITY OF COLORADO

That’s no shadow – it’s sunlight on pension problems

September 4, 2007

Analysis of:Subprime Crises Casts Shadow on Pensions | www.cfo.com

The silver lining in the so-called Subprime Crisis is that it is yet another event that illustrates the need for greater quantities of more useful information in financial statements and financial reports.  As long as management chooses to comply only with the most minimum of standards, they are surrounding their stock with uncertainty, which, in turn, creates risk and drives the stock value down, not up. With regard to pension funds, they are nothing more than proprietary mutual funds in which the employer’s stockholders are obliged to hold an interest, whether they want to or not.  Their fortunes are linked to the management’s ability to manage this pension/mutual fund, and it only makes sense for them to be fully informed as to its portfolio and their risk exposure. In other words, that’s no shadow being cast on pensions – it’s the bright disinfecting sunlight that’s been needed for a long time.

Page : 12345Next1 to 10 of 50