Beruflich Dokumente
Kultur Dokumente
FAS 105, 107, 115, 130, 133, 141, 142, 155, 157, 159
Bob Jensen Emeritus Professor of Accounting Trinity University in San Antonio 190 Sunset Hill Road Sugar Hill, NH 03586 603-823-8482 rjensen@trinity.edu http://www.trinity.edu/rjensen/ Bob Jensens Summary of Accounting History and Theory http://www.trinity.edu/rjensen/theory.htm Not everything that can be counted, counts. And not everything that counts can be counted. Albert Einstein 1-1
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The government gave them 105% for their $200,000 subprime mortgage. They then sold the house for $37,000, got married, and are escaping from California.
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Historical Cost of Individual Assets and Liabilities Summed in Balance Sheet (Book Value) Historical Cost With Price Level Adjustments (PLA) Entry Value (Replacement Cost, Current Cost)
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Exit Value (Net Liquidation Value) Economic Value (Discounted Cash Flows, FCF, Residual Income) Market Value of Entire Firm (Cash Versus Stock Trade) Market Value of All Shares Outstanding
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Graduate student Derek Panchuk and professor Joan Vickers, who discovered the Quiet Eye phenomenon, have just completed the most comprehensive, on-ice hockey study to determine where elite goalies focus their eyes in order to make a save. Simply put, they found that goalies should keep their eyes on the puck. In an article to be published in the journal Human Movement Science, Panchuk and Vickers discovered that the best goaltenders rest their gaze directly on the puck and shooter's stick almost a full second before the shot is released. When they do that they make the save over 75 per cent of the time.
"Keep your eyes on the puck," PhysOrg, October 26, 2006 --http://physorg.com/news81068530.html
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Knotted Strings
South American Indian culture apparently used layers of knotted strings as a complicated ledger. Two Harvard University researchers believe they have uncovered the meaning of a group of Incan khipus, cryptic assemblages of string and knots that were used by the South American civilization for record-keeping and perhaps even as a written language. Researchers have long known that some knot patterns represented a specific number. Archeologist Gary Urton and mathematician Carrie Brezine report today in the journal Science that computer analysis of 21 khipus showed how individual strings were combined into multilayered collections that were used as a kind of ledger. Thomas H. Maugh, "Researchers Think They've Got the Incas' 1-15 Numbers," Los Angeles Times, August 12, 2005
1300s A.D. crusades opened the Middle East and Mediterranean trade routes Venice and Genoa became venture trading centers for commerce 1296 A.D. Fini Ledgers in Florence 1340 City of Massri Treasurers Accounts are in Double Entry form. 1494 Luca Pacioli's Summa de Arithmetica Geometria Proportionalita (A Review of Arithmetic, Geometry and Proportions)
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Venture accounting over the life of a venture with interim statements evolved in The Netherlands 1673 Code of Commerce in France requires biannual balance sheet reporting Charge and Discharge Agency Responsibility and Stewardship Accounting in English trust accounting
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1555 A.D. Russia Company 1600 A.D. East India Company 1670 A.D. Hudson's Bay Company England's Joint Stock Companies Act of 1844 required depreciation accounting for railroads, mining, and manufacturing (although the concept of depreciation dates back to Roman times).
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Laissez-Faire Accounting survived endless debates and scandals until the Great Depression in 1933
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Much of the debate focused on capital maintenance (e.g., failure to charge off depreciation and failure to provide for replacement of operating assets), but governments did not legally impose auditing requirements and serious GAAP until the U.S. securities laws in the early 1930s. Accountants were vocal in reform movements, but governments were slow to react with legislation and courts failed to establish consistent GAAP. Creation of the SEC in an effort to regain public trust in financial reporting and equity investing. Many firms did have independent audits and conformed to the best GAAP traditions of the day (thereby giving some evidence that Agency Theory works sometimes.) Agency theory hypothesizes that it is in the best interest of management to contract for protection of investors and avoid scandalous asymmetries of information.
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After 1933, the AICPA and the SEC seriously attempted to generate accounting standards, enforce accounting standards, and provide academic justification for promulgated standards.
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ASRs of the SEC In a 3-2 vote the SEC followed George O. May's efforts to mandate external audits of securities traded across state lines in the U.S. 1939-1959 A.D.: Accounting standards were generated by the AICPA's Committee on Accounting Procedure (CAP) that issued Accounting Research Bulletins (51 ARBs) --- but the tendency was to overlook controversial issues such as off-balance sheet financing, public disclosure of management forecasts, price-level accounting, current cost accounting, and exit value accounting. Controversial items avoided by the CAP included management compensation accounting, pension accounting, post-employment benefits accounting, and off balance sheet financing (OBSF). The CAP did very little to restrain diversity of reporting.
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After 1933, the AICPA and the SEC seriously attempted to generate accounting standards, enforce accounting standards, and provide academic justification for promulgated standards.
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1960-1972 A.D.: Accounting standards in the U.S. were generated by the AICPA's Accounting Principles Board (APB) that had more members than the CAP and a mandate to attack more controversial reporting issues. The APB attacked some controversial issues but often failed to resolve their own disputes on such issues as pooling versus purchase accounting for mergers. 1972-???? A.D. Accounting standards in the U.S. were, and still are, being generated by the Financial Accounting Standards Board (FASB) that has seven members, including required members from industry, academe, and financial analysts in addition to members from public accountancy. FASB members must divorce themselves from previous income ties and work full time for the FASB. The formation of the FASB was a desperation move by CPA's to stave off threatened takeover of accounting standards by the Federal Government (there were the Moss and Metcalf bills to do just that under pending legislation in the U.S. House and Senate). Unlike the CAP and APB, the FASB has a full-time research staff and has issued highly controversial standards forcing firms to abide by pension accounting rules, capitalization of many leases, and booking of many previous OBSF items (capital leases, pensions, postemployment benefits, income tax accounting, derivative financial instruments, pooling accounting, etc.). The road has been long and hard on some other issues where attempts to issue new standards (e.g., expensing of dry holes in oil and gas accounting and booking of employee stock options) have been thwarted by highly-publicized political pressuring by corporations.
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In Year 2008 foreign corporations may file reports with the SEC and be listed on U.S. stock exchanges using IASB standards rather than FASB standards without reconciling the two.
The U.S., Canada, and other nations are working toward adoption of IASB standards in place of domestic accounting standards.
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IASB is exploring with FASB accounting for fair-value accounting as part of a wider project on measurement. It is in the context of this long-planned effort, and not some recent reaction, that the IASB is planning to and will explore issues related to fair-value accounting.
IAS 32 and 39 Require Fair Value Accounting for Financial Instruments in Many Instances
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Holder, Hopkins, and Wablen (The Accounting Review, 2004, pp. 453-472) found, in a sample of 200 banks, that fair value accounting gave rise to more than five times more earnings volatility than traditional GAAP earnings. Much of the volatilty washes out over time such that earnings increases and decreases from fair value adjustments have zero effect on cash in most instances. This is misleading for going concerns.
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Hirst and Hopkins (Journal of Accounting Research, 1998, pp. 4775) found, in a sample of 200 banks, that fair value accounting improved bank equity analyst judgments about risk and value. Ahmed, Kilic, and Lobo (The Accounting Review, 2006, pp. 567588) found that fair value booking of derivatives after FAS 133 was far more important than mere disclosures in footnotes for banking financial statements. More study needed for non-financial business firms.
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Actually there is potential gain from buying back debt cheaper due to lowered credit rating. Actually there is potential loss from buying back debt cheaper due to improved credit rating. Chasteen and Ransom (Acctg. Horizons, June 2007, pp. 119-136) advocate immediate recognition of such gains & losses and future carrying of debt at risk free rates.
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FAS 105 --- Disclosure of OBSF and market risks of instruments FAS 107 --- Requirements for disclosure of FV FAS 115 --- HTM vs. AFS vs. Trading FAS 130 --- OCI offset instead of current earnings FAS 133 --- FV required for derivative instruments FAS 141 --- Identify and FV intangibles in acquisitions FAS 142 --- Must est. FV of Goodwill remaining FAS 155 --- Requires FV acctg. for hybrid securities FAS 157 --- Defines FV and hierarchy of meas. pref. FAS 159 --- FVO for financial instruments
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"How to Save the Financial System," by William M. Isaac, The Wall Street Journal, September 19, 2008
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FAS 105 --- 1990 FAS 107 --- 1991 to be effective in 1993 FAS 115 --- 1993 to be effective in 1994 FAS 130 --- 1997 to be effective in 1998 FAS 133 --- 1998 but later delayed until 2000 FAS 141 --- 2001 FAS 142 --- 2001 FAS 155 --- 2006 FAS 157 --- 2006 FAS 159 --- 2007 to be effective in 2008
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The face, contract, or notional principal amount The nature and terms of the instruments and a discussion of their credit and market risk, cash requirements, and related accounting policies The accounting loss the entity would incur if any party to the financial instrument failed completely to perform according to the terms of the contract and the collateral or other security, if any, for the amount due proved to be of no value to the entity The entity's policy for requiring collateral or other security on financial instruments it accepts and a description of collateral on instruments presently held. This Statement also requires disclosure of information about significant concentrations of credit risk from an individual counterparty or groups of counterparties for all financial instruments.
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Debt securities that the enterprise has the positive intent and ability to hold to maturity are classified as held-to-maturity securities and reported at amortized cost. Debt and equity securities that are bought and held principally for the purpose of selling them in the near term are classified as trading securities and reported at fair value, with unrealized gains and losses included in earnings. Debt and equity securities not classified as either held-to-maturity securities or trading securities are classified as available-for-sale securities and reported at fair value, with unrealized gains and losses excluded from earnings and reported in a separate component of shareholders' equity. 1-37
classify items of other comprehensive income by their nature in a financial statement and display the accumulated balance of other comprehensive income (AOCI) separately from retained earnings and additional paid-in capital in the equity section of a statement of financial position.
(b)
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Financial Derivatives & Scandals Explode in the Early 1990's Video or Audio clip from CBS Sixty Minutes SIXTY01.avi or SIXTY01.mp3 Audio clip from John Smith of Deloitte & Touche in August 1994 SMITH01.mp3 Examples of derivative contracts that even the professional analysts could not decipher q The derivatives that Merrill Lynch wrote that drive Orange County into bankruptcy q Other derivatives fraud summaries are at http://www.trinity.edu/rjensen/fraud.htm#DerivativesFraud Video and audio clips of FASB updates on FAS 133 q Audio 1 --- Dennis Beresford in 1994 in New York City BERES01.mp3 q Audio 2 --- Dennis Beresford in 1995 in Orlando BERES02.mp3 Derivative Financial Instrument Frauds --- Off line --- Click Here 1-39
Requires booking of most derivative financial instruments at fair value (with some exceptions for NPNS, regular-way, insurance contracts, weather derivatives, short sales, interest-strips, etc.) Derivatives are to be marked to current fair value at least every 90 days and on reporting dates. Changes in fair value are to be charged or credited to current earnings unless the derivatives qualify for hedge accounting treatment as cash flow, fair value, or FX hedges. Not all economic hedges qualify for hedge accounting relief from current earnings.
Hedge accounting rules under FAS 133 and its amendments are very complex.
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Purchase Commitment | Firm Commitment | Forecasted Transaction | Speculation Stand Alone | Cash Flow Hedge | Fair Value Hedge | FX Hedge Purchased Options | Written Options | Long Forwards | Short Forwards | Swaps | Futures Contracts European versus American versus Asian options Spot Price, Forward Price, Strike Price, Premium, Intrinsic Value, Time Value
Freestanding, Embedded, Structured (tailormade rather than convential financing) OCI versus Firm Commitment | Delta
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FAS 141 effective in 2001 Purchase Method Req. for Business Combinations
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In contrast to Opinion 16, which required separate recognition of intangible assets that can be identified and named, this Statement requires that they be recognized as assets apart from goodwill if they meet one of two criteriathe contractual-legal criterion or the separability criterion. To assist in identifying acquired intangible assets, this Statement also provides an illustrative list of intangible assets that meet either of those criteria. In addition to the disclosure requirements in Opinion 16, this Statement requires disclosure of the primary reasons for a business combination and the allocation of the purchase price paid to the assets acquired and liabilities assumed by major balance sheet caption. When the amounts of goodwill and intangible assets acquired are significant in relation to the purchase price paid, disclosure of other information about those assets is required, such as the amount of goodwill by reportable segment and the amount of the purchase 1-42 price assigned to each major intangible asset class.
FAS 142 effective in 2001 Goodwill and Other Intangible Assets Acquired
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Purchased goodwill and other intangibles in business combinations are to be revalued each reporting date and written down to the extent that its historical cost valuation has been impaired. The historical cost is no longer to be amortized except in the case of intangibles with finite lives. In theory the cost of purchased intangibles could stay on the books for many, many years. This Statement provides specific guidance for testing goodwill/ingangibeles for impairment. Goodwill will be tested for impairment at least annually using a two-step process that begins with an estimation of the fair value of a reporting unit. The first step is a screen for potential impairment, and the second step measures the amount of impairment, if any. However, if certain criteria are met, the requirement to test goodwill for impairment annually can be satisfied without a re-measurement of the fair value of a reporting unit.
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Permits fair value re-measurement for any hybrid financial instrument that contains an embedded derivative that otherwise would require bifurcation Clarifies which interest-only strips and principal-only strips are not subject to the requirements of Statement 133 Establishes a requirement to evaluate interests in securitized financial assets to identify interests that are freestanding derivatives or that are hybrid financial instruments that contain an embedded derivative requiring bifurcation Clarifies that concentrations of credit risk in the form of subordination are not embedded derivatives Amends Statement 140 to eliminate the prohibition on a qualifying specialpurpose entity from holding a derivative financial instrument that pertains to a beneficial interest other than another derivative financial instrument.
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FAS 155
Permits fair value measurement for certain hybrid financial instruments that contain an embedded derivative that would otherwise require bifurcation under Statement 133. Amends Statement 133 to require evaluation of all interests in securitized financial assets. thus eliminating the exemption in Statement 133 accounts for certain hybrid instruments. As a result, entities will have to determine if such interest may be: 1. Freestanding derivatives, 2. Hybrid financial instruments containing embedded derivatives requiring bifurcation, or 3. Hybrid financial instruments containing embedded derivatives that do not require bifurcation
Clarifies that only the simplest and most direct separation of interest and principal cash flows need not be evaluated for embedded derivatives 1-45
FAS 155
Clarifies that concentrations of credit risk in the form of subordination are not embedded derivatives. Amends Statement 140 to allow a QSPE to hold passive derivative instruments that pertain to beneficial interest that are or contain a derivative financial instrument Irrevocable election on an instrument by instrument basis with all changes in fair value recognized in earnings. The fair value election should be made at the time the financial instrument is acquired, issued or there is a new basis in a previously recognized financial instrument.
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Upon adoption, applies to existing hybrid financial instruments that had been bifurcated under the requirements of Statement 133.
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FAS 155
No
Yes
No
Bifurcate
Yes
No
Yes
Do Not Bifurcate
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FAS 155
Paragraph 14 of FAS 133 However, interest-only strips and principal-only strips are not subject to the requirements of this Statement provided they (a) initially resulted from separating the rights to receive contractual cash flows of a financial instrument that, in and of itself, did not contain an embedded derivative that otherwise would have been accounted for separately as a derivative pursuant to the provisions of paragraphs 12 and 13 and (b) do not incorporate any terms not present in the original financial instrument described above.
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FAS 155
However, interest-only strips and principal-only strips are not subject to the requirements of this Statement provided those strips (a) represent the rights to receive only a specified proportion of the contractual interest cash flows of a specific debt instrument or a specified proportion of the contractual principal cash flows of that debt instrument and (b) do not incorporate any terms not present in the original financial debt instrument described above. An allocation of a portion of the interest or principal cash flows of a specific debt instrument as reasonable compensation for stripping the instrument or to provide adequate compensation to a servicer (as defined in Statement 140) would meet the intended narrow scope of the exception provided in this paragraph. However, an allocation of a portion of the interest or principal cash flows of a specific debt instrument to provide for a guarantee of payments, for servicing in excess of adequate compensation, or for any other purpose would not meet the intended narrow scope of the exception.
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FAS 155
Nullified Issue D1 Application of Statement 133 to Beneficial Interests in Securitized Financial Assets. Impact of Issue D1 was to defer the bifurcation requirements of Statement 133 Holders of beneficial financial interests must analyze arrangements that govern the payoff structure and the subordination status of the financial instrument Prepayment risks in such structures could result in meeting the 13(b) requirements of Statement 133
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Fair Value Measurements The changes to current practice resulting from the application of this Statement relate to
s the s the s the
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FAS 157
All accounting pronouncements that require or permit fair value measurement and include such items as:
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Investment securities Statement 115 Derivatives Statement 133 Short sales of securities AICPA Audit Guides for certain industries Investments carried at fair value by investment companies
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Certain assets and liabilities measured at fair value in a business combination Statement 141:
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Assets measured at fair value for an impairment test Statements 142 and 144:
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Current Practice
Statement 157
Various definitions of fair value Amount Price that would be received for an at which an asset or liability could be asset or paid to transfer a liability bought or sold in a current transaction between market participants at the between willing parties, that is, other than measurement date. in a forced liquidation sale Presumed equal to fair value May not be representative of fair value; provides indicators of when the transaction price may not be fair value. Independent of the reporting entitys intent: considered from market participant perspective
Current practice is to value assets in continued use unless identified for disposition
Use of Market Data in Valuations Use of market data encouraged. In some Valuation techniques must maximize circumstances entity intent permitted to be use of market observable data and considered in valuations. minimize use of unobservable data Hierarchy
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SOURCE: DELOITTE
Current Practice
Current guidance on market participants is unclear. Buyer-specific intent may be considered Broker-dealers and investment companies permitted to apply block discounts Restrictions on marketable securities not required to be considered in the valuation if the restriction terminated within one year.
Statement 157
New concept Newly defined concept Buyer-specific intent should be dismissed if different from that of other multiple market participants
Block Discounts
Restricted Securities
Fair value measurement should include the effect of a restriction, if the restriction is an attribute of the security which would pass to market participants.
Model Risk
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SOURCE: DELOITTE
Level 3 Level 1
Market- based
Level 2
Extrapolate
Income/FCF Model
Objective
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Subjective
FAS 157
Level 1 Inputs --- Paragraphs 24-27 Quoted prices of identical items in active markets (full rather than thin markets) Fungible goods No timing distress Options versus commodities markets
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FAS 157
FAS 157
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FAS 157
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FAS 157
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FAS 157
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FAS 157
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FAS 157
Level 3 Examples a. Bonds of a bankrupt firm b. Asset retirement obligation c. Pollution abatement obligation d. Enrons booking of fair value of gas contracts
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FAS 157
FAS 157
s Determining
market
s Assigning s Credit
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Allows entities to voluntarily choose to measure eligible financial instruments at fair value (the fair value option) (Exceptions for items covered by some other standards such as consolidated entities, pensions, post-employment contracts, leases, and financial insurance contracts) Changes in fair value recognized in earnings. (no OCI) Election made on an instrument-by-instrument basis Irrevocable
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Provide an opportunity to mitigate volatility in earnings caused by a mixed attribute accounting model Reduce the need for applying complex hedge accounting provisions Expand the use of fair value measurements International convergence
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Scope:
Recognized financial assets and liabilities (but not forecasted transactions under FAS 133) Firm commitments that would otherwise not be recognized at inception and that involve only financial instruments Written loan commitments Certain rights and obligations under insurance contracts or warranty obligations A financial host contract in a nonfinancial hybrid instrument Certain nonfinancial assets and liabilities
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Advantages:
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Eliminate arbitrary FAS 115 classifications that can be used by management to manipulate earnings (which is what Freddie Mac did in 2001 and 1002. Reduce problems of applying FAS 133 in hedge accounting where hedge accounting is now allowed only when the hedged item is maintained at historical cost. Provide a better snap shot of values and risks at each point in time. For example, banks now resist fair value accounting because they do not want to show how investment securities have dropped in value.
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Disadvantages of Auditing FV
The purpose of this International Standard on Auditing (ISA) is to establish standards and provide guidance on auditing fair value measurements and disclosures contained in financial statements. In particular, this ISA addresses audit considerations relating to the valuation, measurement, presentation and disclosure for material assets, liabilities and specific components of equity presented or disclosed at fair value in financial statements. Fair value measurements of assets, liabilities and components of equity may arise from both the initial recording of transactions and later changes in value.
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Exclusions:
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Investments in consolidated entities Financial obligations for items such as pension benefits and other deferred compensation arrangements Income tax assets and liabilities Financial assets and liabilities recognized under leases as defined in Statement 13 Deposit liabilities, withdrawals on demand, of depository institutions Financial instruments that are, in whole or in part, a component of shareholders equity
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The Boards objectives in this project are to: (a) establish a single source of guidance for all fair value measurements required by IFRSs, (b) clarify the definition of fair value and related guidance in order to more clearly communicate the measurement objective, and (c) enhance disclosures about fair value
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The European Commission has published Frequently Asked Questions providing the Commission's views on the following questions: Why did the Commission carve out the full fair value option in the original IAS 39 standard? Do prudential supervisors support IAS 39 FVO as published by the IASB? When will the Commission to adopt the amended standard for the IAS 39 FVO? Will companies be able to apply the amended standard for their 2005 financial statements? Does the amended standard for IAS 39 FVO meet the EU endorsement criteria? What about the relationship between the fair valuation of own liabilities under the amended IAS 39 FVO standard and under Article 42(a) of the Fourth Company Law Directive? Will the Commission now propose amending Article 42(a) of the Fourth Company Directive?
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FAS 32 --- Financial Instruments FAS 39 --- Derivative Financial Instruments FAS 41 --- Agriculture
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Question What's the status of international accounting for customer loyalty incentive awards such as airline miles, first class upgrades, hotel discounts, restaurant discounts, etc.? Answer There is a deferred revenue and liability recognition for future cost requirement. Allocation of the original sale is to be based upon estimated fair value of components of the sale.
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1. The main issue addressed in the Interpretation is the recognition and measurement of obligations to provide customers with free or discounted goods or services if and when they choose to redeem loyalty award credits. 2. One approach used at present is to accrue an expense at the time of the sale, when the award credits are granted. The expense is based on the costs the entity expects to incur to supply the free or discounted goods or services. The rationale for this approach is that loyalty awards are incidental costs of securing the first sale, which should be recognised when that sale is made. 3. A second approach is to divide the proceeds of the first sale into two componentsan amount that reflects the value of the goods or services delivered in the first sale and an amount that reflects the value of the loyalty award credits. Proceeds allocated to the first component are recognised as revenue at the time of the first sale. But proceeds allocated to the award credits are deferred as a liability until the entity fulfils its obligations in respect of the award credits, either by supplying the free or discounted goods or services itself when customers redeem the credits, or engaging (and paying) a 1-78 third party to do so.
4. The practical difference between the two approaches is the measurement of the liability. The first approach measures the liability on the basis of expected costs; the second on the basis of selling prices. 5. The Interpretation requires entities to apply the second approach. The requirement reflects the IFRICs view that loyalty awards are separately identifiable goods or services for which customers are implicitly paying. The general standard on revenue recognition, IAS 18 Revenue, requires separately identifiable components of sales transactions to be accounted for separately if necessary to reflect the substance of the transactions.
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ForwardRate(t) = [1 + y(t)]t/[1 + y(t-1)]t-1 1 The ForwardRate(t) is the forward rate for time period t, y(t) is the multi-period yield that spans t periods, and y(t-1) is the yield for an investment of t-1 periods --- for example, if 6.5% is y(t) and 6.0% is y(t-1). Thus, ForwardRate(2), the forward LIBOR for year 2, is calculated as follows ForwardRate(2) = (1.065)2/(1.06) 1 = 0.07 or 7.0%
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Audited vs. unaudited statements to reflect accurate levels of inventories and receivables. Determine latest work-in-process value -- particularly where production costs have been expensed rather than capitalized.
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Adjust for differences in cash vs. accrual methods of reporting income. Add back any "excess" owner/employee cash compensation and fringe benefits.\ Determine net fair market value for tangible assets (eg., book value vs. liquidation value vs. replacement value of equipment, obsolete or slow-moving inventory, supplier return privileges, credits, etc.). Determine undisclosed and/or disputed liabilities (eg., unfunded past service costs or multi-employer obligations for pension plans, deferred compensation plans; incentive bonuses; stock options; potential contract or tort claims; potential unfunded sales income or payroll tax obligations).
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There is usually no "magic" correct value but rather an appropriate range of values dependent upon the "fit" of buyer and seller and the realism of the assumptions utilized in the valuation methodology. Also, consideration should be given to internal expressions of valuation (eg., buy-sell agreements, insurance arrangements, and deferred compensation and noncompetition agreements).
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A qualified business appraiser can offer insights as to comparable sales or to appropriate valuation calculation assumptions (eg., industry risks and capitalization rates, interest rates, etc.) as well as helpful analyses of alternative valuation method approaches (eg., discounted cash flow analysis vs. liquidation value vs. tangible/intangible asset valuation as set forth in Revenue Ruling 59-60 as modified/amplified by Revenue Rulings 65-192, 65-193, 68-609, 71-287, 80-213 and 83120; etc.).
Synergies Supplementary product lines Operating economies and/or vertical integration opportunities New supply or distribution avenues Limination of price and customer competition R&D, Patents, Copyrights Skilled and loyal work force No huge owner dependencies
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Eppraisal.com --- http://eppraisal.com/ Realestateabc.com --- http://realestateabc.com/ Homegain.com --- http://homegain.com/ Zillow --- http://www.zillow.com/
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Banking Concerns
BIS Paper 109 --- Online Click Here Offline Click Here
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The End
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