Financial Accounting Standards Research Initiative

To what extent do lenders or credit analysts care about lease renewal options? In the proposed lease accounting model, lessees will capitalize the longest lease term that is more likely than not to occur. This means that renewal periods that a lessee is not obligated to renew will be measured as part of the lease [...] Read more > >

How often do we get to use big esoteric words from philosophy when we are talking about accounting standards?  Not often enough! Usually, the only philosophical terms we use are ‘normative’ and ‘positive,’ and I think many of us are pretty comfortable with the notion that standard setters are trying to answer normative questions (what should [...] Read more > >

We have already had a couple great posts on the FASB/IASB Financial Reporting Issues Conference by Ray and Rob.  I’d like to add a comment on something that struck me over the weekend. One of the important issues in revenue recognition is the question of whether a company is providing a good or service in return [...] Read more > >

One issue that came up repeatedly for me at this weekend’s FASB-IASB reporting issues conference was that of the apparent clash between the objective to provide relevant information through financial reports and the objective to maintain consistency with the conceptual framework’s definitions of assets and liabilities. An example illustrates the nature of the problem: consider a [...] Read more > >

For most of this decade, the Financial Reporting Issues Conference has been my favorite accounting event of the year.  Taking a Bayesian perspective, I also view it as the most informative:  every year, what I learn changes my beliefs more than any other conference. I will be writing some posts about the substance of the conference, [...] Read more > >

In their joint meeting in Norwalk, Connecticut this past week, the IASB and FASB reached the tentative conclusion that lessors will no longer derecognize leased assets. Instead, lessors will recognize a receivable and a performance obligation with revenue being recognized over time. Some think this approach is more consistent with the proposed new revenue recognition [...] Read more > >

We had an excellent discussion today with Bob Laux of Microsoft. Whether you are looking for research topics or good stories for your students–financial or managerial–you will find this a very interesting discussion. You can now watch the archive live by going here, waiting through a 15 second commercial, and then clicking the [...] Read more > >

Details on participation are here. On Wednesday, July 22nd, 11am ET, we will get a preparer’s perspective on the state and future of financial reporting standards from Bob Laux, Senior Director of Financial Accounting and Reporting at Microsoft.  Mr. Laux is responsible for Microsoft’s financial accounting, including  responding to GAAP questions and issues within Microsoft and [...] Read more > >

The issue of accounting for contingent rentals was a big part of the recent research brainstorming session on leasing.  I think that academics may have something to offer the FASB and others related to accounting for contingent rentals.  In particular, what can economic/finance theory tell us about the desirability of capitalizing expected contingent rentals? One of [...] Read more > >

We had a very interesting session yesterday to brainstorm ideas on leasing.  Thanks to another doctoral student for summarizing key parts of the discussion.  –RJB Despite the loss of power of our campus 15 minutes prior to the beginning of the office hour and the rush to set up everything on our backup battery, I, along [...] Read more > >

This week, office hours (Tue, June 2nd, 4pm ET) will consist of something a bit different.  In particular, I want to see if we can have an interactive session involving bouncing research ideas off of each other.  This is one of the types of sessions that we discussed during May 19th office hours. How can we [...] Read more > >

On Wed, March 4th, we will be joined (once more) by Danielle Zeyher, FASB Project Manager of the joint FASB/IASB leasing project.  In addition to getting an update on the status of the project, we will also have an open discussion of the extent to which academic research can inform standard setters.  As a springboard [...] Read more > >