SEC Moves to Pull Plug On U.S. Accounting Standards

[SD Transplant]

I believe this is huge news.

http://online.wsj.com/article/SB121985665095476825.html

“WASHINGTON — The Securities and Exchange Commission signaled the demise of U.S. accounting standards, kicking off a process Wednesday that could ultimately require all publicly listed American companies to follow an international model instead.”

“A move to international standards “will likely inflate the earnings of U.S. companies and mislead investors,” said Gregory Pai of Paradigm Asset Management in White Plains, N.Y. On the plus side, he noted, the convergence should eventually allow multinationals to save on their accounting bills.”

[cr]

Haven’t read it yet but if it means you can no longer book and report the entire interest income from a 30 year loan that you just sold to the next biggest sucker of an investor before you even receive a payment then it’s a good thing.

[cr]

Haven’t read it yet but if it means you can no longer book and report the entire interest income from a 30 year loan that you just sold to the next biggest sucker of an investor before you even receive a payment then it’s a good thing.

[cr]

Haven’t read it yet but if it means you can no longer book and report the entire interest income from a 30 year loan that you just sold to the next biggest sucker of an investor before you even receive a payment then it’s a good thing.

[cr]

Haven’t read it yet but if it means you can no longer book and report the entire interest income from a 30 year loan that you just sold to the next biggest sucker of an investor before you even receive a payment then it’s a good thing.

[cr]

Haven’t read it yet but if it means you can no longer book and report the entire interest income from a 30 year loan that you just sold to the next biggest sucker of an investor before you even receive a payment then it’s a good thing.

[Ex-SD]

cooprider: I remember when they passed that stupid legislation back in the 80’s. The IRS wanted it so they could collect the taxes before you actually collected your money on installment sales but the Wall Street boys turned it to their advantage for just what you posted. Sometimes, the govt. is just dumber than a stick.
Good post!

[Ex-SD]

cooprider: I remember when they passed that stupid legislation back in the 80’s. The IRS wanted it so they could collect the taxes before you actually collected your money on installment sales but the Wall Street boys turned it to their advantage for just what you posted. Sometimes, the govt. is just dumber than a stick.
Good post!

[Ex-SD]

cooprider: I remember when they passed that stupid legislation back in the 80’s. The IRS wanted it so they could collect the taxes before you actually collected your money on installment sales but the Wall Street boys turned it to their advantage for just what you posted. Sometimes, the govt. is just dumber than a stick.
Good post!

[Ex-SD]

cooprider: I remember when they passed that stupid legislation back in the 80’s. The IRS wanted it so they could collect the taxes before you actually collected your money on installment sales but the Wall Street boys turned it to their advantage for just what you posted. Sometimes, the govt. is just dumber than a stick.
Good post!

[Ex-SD]

cooprider: I remember when they passed that stupid legislation back in the 80’s. The IRS wanted it so they could collect the taxes before you actually collected your money on installment sales but the Wall Street boys turned it to their advantage for just what you posted. Sometimes, the govt. is just dumber than a stick.
Good post!

[cr]

Agreed. I read it and at first the looser standards they talk about sound like they would be even easier to exploit.

Then I got to this part and it hit me:

“Real Estate: companies can revalue certain assets to fair value.”

Notice it didn’t say de-value, but re-value.

Initially you’d think to mark down underperforming RE assets, but what’s to stop companies from hoarding say, foreclosed homes, “revaluing” them at a “fair” value (what determines fair) and booking gains in an asset worth less then the loan against it?

I’m no accountant so I’m probably missing many other benefits but it doesn’t sound like it would prevent much of the debacle we’ve seen.

[cr]

Agreed. I read it and at first the looser standards they talk about sound like they would be even easier to exploit.

Then I got to this part and it hit me:

“Real Estate: companies can revalue certain assets to fair value.”

Notice it didn’t say de-value, but re-value.

Initially you’d think to mark down underperforming RE assets, but what’s to stop companies from hoarding say, foreclosed homes, “revaluing” them at a “fair” value (what determines fair) and booking gains in an asset worth less then the loan against it?

I’m no accountant so I’m probably missing many other benefits but it doesn’t sound like it would prevent much of the debacle we’ve seen.

[cr]

Agreed. I read it and at first the looser standards they talk about sound like they would be even easier to exploit.

Then I got to this part and it hit me:

“Real Estate: companies can revalue certain assets to fair value.”

Notice it didn’t say de-value, but re-value.

Initially you’d think to mark down underperforming RE assets, but what’s to stop companies from hoarding say, foreclosed homes, “revaluing” them at a “fair” value (what determines fair) and booking gains in an asset worth less then the loan against it?

I’m no accountant so I’m probably missing many other benefits but it doesn’t sound like it would prevent much of the debacle we’ve seen.

[cr]

Agreed. I read it and at first the looser standards they talk about sound like they would be even easier to exploit.

Then I got to this part and it hit me:

“Real Estate: companies can revalue certain assets to fair value.”

Notice it didn’t say de-value, but re-value.

Initially you’d think to mark down underperforming RE assets, but what’s to stop companies from hoarding say, foreclosed homes, “revaluing” them at a “fair” value (what determines fair) and booking gains in an asset worth less then the loan against it?

I’m no accountant so I’m probably missing many other benefits but it doesn’t sound like it would prevent much of the debacle we’ve seen.

[Author]

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