The Double Illusion of Financial Statement Comparability and Auditability: Through the Lens of Falling O&G Prices
My inspirations for this post are the maiden speech of the SEC’s new chief accountant James Schnurr, and the joy of paying only $2.02/gallon at the pump. As for Mr. Schnurr, I plan to dissect his remarks more fully in…
Research on Accountants’ Salaries
The following message is from Jennifer Stevens, professor in the Department of Accountancy at the University of Notre Dame. Fellow accountants - we need your help. How much did an entry-level accountant make in 1960 as compared to today? Everyone…
Gross versus Net Presentation: The First of Many Revenue Recognition Debacles to Come?
Pick any class of upper-level accounting students, and give them a few cases of supplier/customer relationships for which “gross versus net presentation” of revenues is an issue, and I’ll wager that the class will come to a consensus on the presentation…
Accounting Estimates: What Investors Should Want
Last week, the PCAOB convened its Standing Advisory Group to discuss the topic of auditing accounting estimates and fair values. I was invited to be on a panel providing investors' perspectives.* This post mainly consists of an unofficial transcript (with…
Revenue Recognition: A Litmus Test for Convergence with IFRS
Do you remember the Big Four mantra that IFRS adoption in the U.S. was “inevitable”? Today, thankfully, the operative word is “dead.” Even former SEC chair, Christopher Cox, whose brainchild was the IFRS adoption Roadmap, now comes to “bury IFRS." But…
Trying My Best to Save LOCOM for Inventory
In my previous post, I expressed my opposition to the FASB's proposal for replacing the LOCOM rule for inventory with “lower of cost or net realizable value." I stated that the extant U.S. GAAP on LOCOM embodied a principle of…
The FASB Wants to Dumb Down Inventory Impairment
OK, let’s start with something positive. The FASB recently issued proposals to simplify two accounting topics, and whaddya know, I am actually in favor of one of them. The "extraordinary item” income statement category is rarely used, and the highly…
Loan Accounting: It’s High Time for the SEC to Step Up to the Plate
"Full convergence with the United States - leading to the creation of one single set of global accounting standards - is no longer an achievable project… But IFRS moves on - we have a large part of the world…