Financial Accounting Standards Research Initiative

I think everyone would agree there are many reasons to enter a lease. However, I think we would all also agree that if the only reason to enter a lease was to obtain a certain accounting treatment then the accounting should be changed. Bill Bosco raised some very interest points related to the leasing industry [...] Read more > >

Thanks to everyone who participated in yesterday’s Round Table event. We had a great discussion about leasing. You can watch the video above. To skip the splash screen, scroll forward to 13:25. There is a brief problem with the sound until minute 14, but things are fine after that. I think a big take-away from the [...] Read more > >

If you assumed that accounting standards wouldn't get sucked into the highly charged health care debate, you guessed wrong! From the New York Times An association representing 300 large corporations urged President Obama and Congress on Monday to repeal a provision of the health care overhaul that prompted AT&T, Caterpillar and other companies to announce substantial [...] Read more > >

The great thing about people who represent an industry being affected by an accounting standard is that they are highly motivated to provide content.  Bill Bosco sent me a number of files for this week’s Roundtable.  The ELFA comment letter on leasing discusses both lessor and lessee accounting, and objects strongly to the notion that [...] Read more > >

Bill Bosco, who will be our speaker at today’s Roundtable, sent along the text of his comment letter on leasing to the IASB.  Here it is, in its entirety: Sir David Tweedie                                                                              July 12, 2009 Chairman IASB Dear Sir: I support the theory that operating lease obligations arising from material operating leases should be capitalized.  The issue of capitalizing operating [...] Read more > >

On March 9, Scott Dyreng led a session on how social norms affect people’s behavior.  I made a post a few days later on the subject with a cite to work by Steve Huddart.  Yesterday I saw another example of how social objectives affect employee utility functions, but this one seems quite different. Adam Grant, [...] Read more > >

On Dec. 15, 2009 we had a great Round Table on Earnings Management Research with Paul Zarowin. Here's the video if you missed it. Also, a follow-up post had some ideas of "must-reads" for Earnings Management Research. The show starts approximately 9 minutes into the video. Read more > >

The FASRI Roundtable this week (11am ET, Weds Mar 31, 2010) will be lead by Bill Bosco, a member of the IASB/FASB International Working Group on leas accounting, Principal of Leasing101, and long time member of the Accounting committee of the Equipment Leasing and Finance Association (ELFA), a trade association representing the $650 billion dollar [...] Read more > >

The paradoxical title of this post is quoted from this article in Science News about the inconsistent and often inappropriate use of statistics in academic research.  I would strongly recommend every accounting researcher read the article, make sure they understand the criticisms, and then promptly ignore most of them. The article emphasizes that statistical significance is [...] Read more > >

NOTE: THIS EVENT WILL BE RESCHEDULED, DATE TBD. After a two week Spring break hiatus (during which we faculty were all catching up on work, of course), FASRI returns with a Roundtable featuring Stephen Cooper, current IASB member and former Managing Director in the Equities business of UBS Investment Bank in London from 1997 to 2008.  [...] Read more > >

The NCAA basketball tournament is well under way, filled with excitement and tears. An interesting paper by Coyne, Summers, Williams, and Wood attempts to rank accounting programs by their research productivity. In the spirit of the NCAA tournament, one of the authors went ahead and filled out a March Madness bracket based on those rankings. You [...] Read more > >

Somebody asked me about Nike’s redeemable preferred stock. SFAS 150 is not my area of expertise really, but .. the question that came to me was “is this in the mezannine?” I understood that nothing was there anymore. This company (nike) seems to be putting it in the mezannine but not really .. [...] Read more > >

I just came across this and have listened only to part of the first series (of five) but it seems quite interesting (and humorous). http://www.bbc.co.uk/iplayer/episode/b00r401p/A_Brief_History_of_Double_Entry_Bookkeeping_Episode_1/ Read more > >

Let’s suppose that a student (me for example), about to start a PhD program, came to you and asked for a summer readings list to introduce them to financial accounting research. What would be on that list? I’ll throw out a couple of my own ideas, but I’m very interested in hearing yours. Most of JAE [...] Read more > >

My colleague here at Texas, John McInnis, just sent around an interesting email to the UT faculty. I thought I’d share it more broadly. He raises an interesting question..   The web is a abuzz with the release of the Lehman Brothers post-mortem by the Bankruptcy Examiner yesterday.  I wasn’t aware of potential accounting gimmicks:  http://www.economist.com/business-finance/displaystory.cfm?story_id=15695099  Many are starting [...] Read more > >

Part of Tuesday’s Roundtable with Scott Dyreng focused on how social norms might interact with accounting and financial reporting.  In the typed and voice chat, reference was made to a paper by Paul Fischer and Steven Huddart, titled “Optimal Contracting with Endogenous Social Norms” (American Economic Review, Sept 2008, 1459-75).  I really like the paper, [...] Read more > >

In class yesterday, I stumbled upon an interesting apparent inconsistency between accounting for pensions and the accounting for compensated employee absences, which I had taught several weeks ago. When teaching my students about accruing for vacation pay, I observed that it seemed that if we knew for certain that employees were likely to get a raise [...] Read more > >

Big thanks to Mark Evans and everyone who participated in yesterday’s Round Table. We look forward to seeing you all next week. Read more > >

Join us Tuesday, March 9 at 4pm when Scott Dyreng of Duke University discusses his recent research on the cost of violating covenants on private debt.  The key message of the paper is that firms are willing to pay extra taxes in order to avoid debt covenant violations.  The study uses [...] Read more > >

I just read an article (p. 22) about the CPA examination changes effective Jan. 1, 2011. The AICPA official release can be found here. There are several major changes taking place at the same time. I list three below: 1. Switch from two case-based simulations to six or seven task-based simulations. 2. Testing of the organization and use [...] Read more > >