Financial Accounting Standards Research Initiative

From a Credit Suisse First Boston report From a Credit Suisse First Boston report By David Zion, Amit Varshney, and Christopher Cornett Spinning Losses into Gold November 12, 2009 Last Friday President Obama signed into law the Worker, Homeownership and Business Assistance Act of 2009, which among other things contains an amendment that would temporarily extend the carryback period [...] Read more > >

In my technical accounting research class and in recent consulting work, I often have been reminded of the need for reasoned judgment in our profession. With the general move toward more objectives-based standards (using the SEC parlance), the need for professional judgment only will increase.  Recognizing the need to teach and understand what professional judgment [...] Read more > >

Somehow I ended up on the mailing list of Risk.Net, which hails itself as “The world’s leading monthly magazine dedicated to the risk management and derivatives industries.”  In this week’s top story, headlined “Abuse of revised IFRS standards “inevitable” – IASB’s Leisenring“, Jim is quoted as expressing concern about using management intent to determine how [...] Read more > >

I’ve often heard of academics heading off to do an academic fellowship. Several, upon return, have commented on how the fellowship helped them connect with urgent issues, charge their batteries, and get ideas and resources for research. Fellowship opportunities are diverse in their functions and duration. Firms, standard setters, enforcement agencies, etc. are often interested in [...] Read more > >

Jeremy Bentley (& friend) I just got off the phone (Skype, actually) with our new editorial assistant, Jeremy Bentley.  Jeremy is in BYU’s PhD-prep program, which has generated a number of successful accounting researchers.  Jeremy will be doing a little work behind the scenes, but his primary duty will be more visible:  to keep our blog [...] Read more > >

On Tuesday, Jan 12th, 4 pm ET, we will be joined by Jim Leisenring. Jim is currently a member of the IASB, where he has been serving since 2001. Given his prior role as a director and later a board member at the FASB, Jim arguably has more standard setting experience than just about any [...] Read more > >

I hope everyone is refreshed and ready for the new year — and a challenging one it will be for standard setters, with the convergence deadlines rapidly approaching.  To get you started, here are some thoughts on Principles vs. Rules, from Paul Miller and Paul Bahnson, academics who have a regular column (The Spirit of [...] Read more > >

It isn’t too surprising that the FASRI blog has been quiet, and it surely will be for another week or so.  There will be some interesting changes and improvements to the site when you return from vacation (I’ll keep you in suspense for now). But if you need your fix of accounting information and commentary, it [...] Read more > >

In one of our discussion groups at the FASB’s Financial Reporting Issues Conference, we had a lengthy discussion about whether a lease represented the promise to transfer a bundle of rights (which could be satisfied at contract signing) or the promise to allow someone to use an asset for a fixed period of time (which [...] Read more > >

We had a great Round Table with Paul Zarowin yesterday, where we talked about the large and ever-growing literature on earnings management.  While much has been done in this area, it was clear from yesterday’s discussion that there remain many fruitful areas for future research.  If you didn’t get the chance to join us, I [...] Read more > >

My colleague John McInnis at Texas alerted me to this article. Very good stuff.   I wonder how much will come back on the balance sheet with the new rules that go into effect in Q1 of 2010.  I have read that Citibank expects (don’t have figure handy) a relatively small portion to come back on [...] Read more > >

I’ve been thinking about something Jeff Wilks said during this week’s FASRI Roundtable and something that occurred to me during the conference.  In short, it is the notion that it might be useful to consider perspectives other than the customer consideration model for revenue recognition.  (Forgive me, Jeff, if I misunderstood your comments Wednesday, and of [...] Read more > >

On Tuesday, Dec 15th, 4 pm ET, we will be joined by Paul Zarowin. Paul Zarowin is a professor at New York University and an Editor at The Accounting Review. The topic of this session is earnings management, and Paul is going to provide us with a high level review of this literature and the [...] 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 > >

Having recently attended the FASB/IASB issues conference on revenue recognition, leasing (lessor), and insurance, I was struck by how terminology gets in the way.  For example, figuring out what “unit of account” might mean seems to be something many debates were centered around … yet there’s not a definition of this notion.  So much of [...] 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 > >

Are you comfortable with allowing management to choose whether to recognize unrealized gains or losses based on management’s intent to hold securities to maturity?  How about basing the timing of revenue recognition on the firm’s business model?  Differences in intent and business models might very well alter what information users find relevant.  However, intent and [...] 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 > >

As posted here, FASRI is issuing a call for research consultants to conduct revenue recognition studies.  This call is a little different from the usual ‘call for proposals’ because applicants must be willing to work closely with FASRI and FASB staff to identify research topics that will be most helpful in staff and Board deliberations.   [...] Read more > >

The Financial Accounting Standards Research Initiative (FASRI) is issuing an open call for academic researchers to serve as Research Consultants for a Revenue Recognition Research Project.  Research consultants will work with members of FASRI to develop rigorous research studies likely to be helpful with the FASB and IASB deliberations on revenue recognition and related topics.  [...] Read more > >