The Equipment Leasing & Financing (ELF) Foundation issued a study on leases in December. We assume these elves were hoping Santa would present them a gift of no amendments to lessee accounting. After all, why report economic reality if you don’t have to?
In a recent article, Michael Rapoport says “What quirks in accounting rules giveth, they also taketh away.” We agree whole-heartedly.
If principles-based accounting is superior to rules-based accounting, as professed by so many in the profession, then this proposition ought to apply to other areas as well, including accounting ethics. The profession could set up accounting ethics as a principles-based system or as a rules-based codification, and which direction the profession chooses will speak volumes [...]
With the collapse of MF Global, focus naturally moves to the risky repo transactions in which the business enterprise engaged and the accounting for these transactions. After all, billions of dollars of liabilities were kept off the balance sheet. What rationale did MF Global have to remove the liabilities from its balance sheet?
Last Thursday the FASB updated accounting for goodwill impairment, specifically focusing on the testing of goodwill impairments. The details are given in 2011-08, which is entitled Intangibles—Goodwill and Other (Topic 350): Testing Goodwill for Impairment. We don’t understand the dilution of a rather simple concept.