* UPDATE: The archived video is shown above. Please note that the welcome screen is displayed for the first 11 minutes and 10 seconds. You’ll want to skip to 11:10 in the video to begin seeing the discussion.

We just finished a great Roundtable with Jim Leisenring from the IASB. We will get the video online as soon as we can. In the meantime, here’s a brief synopsis of what was discussed:

  • How do we use standards to eliminate or mitigate transaction structuring? It’s a great goal, and something we’d all like to see, but unfortunately there’s not much we can do about it. Often bright lines invite people to approach the line, and unfortunately substance over form doesn’t fix the problem very often. A good example of this is derivative accounting and embedded cash derivatives.
  • Jim discussed his thoughts about “management’s view” and “business models” in disclosure, presentation, and recognition. He also gave some of his reasoning as to why he dissented on IFRS 9.
  • Jim listed some things that he thinks are particularly important topics right now including hedging, impairment, consolidations, derecognition, and the distinction between debt and equity. Basically anything that has to do with financial instruments is important right now.
  • With regards to convergence of IFRS and US GAAP, the biggest challenge is to get it all done. The challenge will be getting everything done on time but still keeping the quality high. There’s a lot of due process involved and a lot is learned during the exposure time period. The financial crisis has added a new challenge to the timetable, but the 2011 date is still firm.
  • There was a good discussion about entry price, value-in-use, and exit price with regards to fair value accounting. Jim said that he believes that exit prices will be the basis of fair value accounting.
  • Jim concluded with giving some thoughts about academic research. He recommended two articles, both in the December 1994 issue of Accounting Horizons: (1) “Academic Accounting Research and the Standard Setting Process” by Katherine Schipper and (2) “Accounting Research: On the Relevance of Research to Practice” by James Leisenring and Todd Johnson.

For more information about Jim and his background, visit here.

Additionally follow-up comments on this Round Table event can be found here.

Jeremy Bentley

Jeremy Bentley

Jeremy Bentley is a PhD Prep student at Brigham Young University.

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