The securities law blogosphere has been bubbling with speculation — since the April 15 oral arguments in Free Enterprise Fund, et al. v. PCAOB — over how the D.C. Circuit Court might rule in the case. It is possible that the PCAOB and SOX could disappear in a cloud of appellate ink before summer’s end. Some observers, including the Washington Legal Foundation, believe it’s high time: Continue reading
They say once you’ve seen sausage made, you’ll never eat it again. In this sense, sausage and accounting principles may have something in common. Since 2004, the Financial Accounting Standards Board (FASB) and International Accounting Standards Board (IASB) have been jointly engaged in an effort to create an accounting version of what physicists might call a “revenue theory of everything.”
Arguably, revenue is the single most-watched line item in company financial statements. You’d think it would have received lots of standard-setting attention in the past, but it hasn’t. We might call it U.S. GAAP’s “missing link”. For all of its pretensions to “quality” and “rigor,” U.S. GAAP has no general standard for recognizing or measuring company revenue. Hard to believe? Not if you knew how accounting sausage is made. But revenue is one important chunk of sausage and its getting lots of attention nowadays from both IASB and FASB. Continue reading
International Financial Reporting Standards (IFRS) are looming quickly for U.S. companies. A good sign of how quickly is SEC Chairman Cox’s speech at IOSCO, in Paris on May 28, 2008 where he referred to IFRS as the world’s accounting “lingua franca”. Another telling signal is that accounting firms and academics are getting together to talk seriously about the IFRS transition. On May 15-16, 2008, I attended a Deloitte Touche and Federation of Schools of Accountancy Faculty Consortium, in Chicago. IFRS was the theme. This post summarizes my notes on the event.* Continue reading
Lucky or smart, Ireland has rejected the EU bureaucracy’s latest attempt — called the Treaty of Lisbon — at extending is power. A strangely bitter-sounding International Herald Tribune reports:
Europe was thrown into political chaos Friday by Ireland’s rejection of the Lisbon Treaty, a painstakingly negotiated blueprint for consolidating the European Union’s power and streamlining its increasingly unwieldy bureaucracy.
Political chaos? Painstakingly negotiated? Can you say, “Drama queen”? Continue reading
Like a lumbering Spanish galleon, the European Union’s most recent attempt at increasing its influence at home and abroad — the leviathan Treaty of Lisbon — has run into heavy seas off the coast of Ireland. The International Herald Tribune reports:
DUBLIN: The final straw, Dermot Gilmartin said, was seeing an official struggling on television to answer questions about the topic of the hour: the European Union’s Lisbon treaty, on which Ireland will vote in a referendum Thursday. Challenged on a technical point, the official sputtered, frantically began rifling through his papers and fell silent.
For two and a half minutes.
“I was cringing for the guy,” said Gilmartin, 25, as he made his way to the local pub one recent afternoon. But pity aside, Gilmartin said, why should he vote for something so abstruse that even someone whose job it is to understand the treaty cannot explain away its mysteries? . . .
I don’t have a vote, obviously. But my take on the treaty is that it would drive the EU further toward the U.S. model in which centralized bureaucracy grows far beyond the good of the people and territories over which it exercises power. For the good of Europe, its member states need to retain as much as possible of their individual sovereignty.
In this regard, the United States went off the rails by 1913 with the ratification of the 16th and 17th Amendments to the Constitution and the legalization of individual income tax.
We should know more later today.