GLG News by Pension Accounting Specialists

Thomas KleinManaging MemberKleinCPA PLLC

Obama Expected to Sign Generous NOL Carryback Bill on Friday

November 5, 2009

Analysis of:Congress Passes Unemployment Bill With Tax Items | www.journalofaccountancy.com

On Thursday, Congress sent a bill to the White House containing enhanced net operating loss (NOL) carryback opportunities for most companies. The bill contains a provision extending the NOL carryback period from two years to five years for losses incurred in 2008 or 2009. President Obama is expected to sign the bill on Friday which would result in the immediate filing for refunds by many companies.

Thomas KleinManaging MemberKleinCPA PLLC

Obama Administration Moves Foreign Earnings Tax Deferral Reform to Back Burner

October 13, 2009

Analysis of:Business Fends Off Tax Hit | online.wsj.com

Once again, a proposal to reform how a U.S. based multinational company's foreign earnings are taxed has failed to gain congressional support. Similar proposals introduced over the past twenty years have consistently failed to gain traction. The current proposal was part of the Obama administration's fiscal year 2010 budget which made reference to additional tax revenues in excess of $200 billion related to the reform of corporate taxation on foreign earnings.

Robert KempProfessorUniversity of Virginia - CC

Reality Impact - Grasping the Cost of Not Acting to Restore Trust in Capital Markets

September 19, 2008

Analysis of:Fed Tentatively Agrees to Provide $85bn to AIG | www.washingtonpost.com

There are significant arguments today on what should or should not be done to address the current capital market crisis.  In reality, market economies first and foremost rely on trust.  When trust is lacking, the ramifications are significant and far reaching.  The mistrust of one sector multiples into problems throughout other sectors.  A good example is the impact of capital markets on nonfinancial services businesses.  This point is easily seen in the cost of credit, or the lack of credit.  However the impact is much greater than mere credit.  An example is unfudned pension and other post retirement benefit plans (OPEB). The cost of not restoring trust in the capital markets needs to be understood, in all aspects.  The price is high (e.g., government spending and assuming risk) on both sides of the argument.  However all costs, on both sides, must be understood and measured before judgements are made.

Robert KempProfessorUniversity of Virginia - CC

Fair Value Accounting - The Good And Bad Of It In The Real World

September 15, 2008

Analysis of:Fair-Value Revolution: Historical cost accounting is fading as Corporate America marches into a new era. | www.cfo.com

Fair value accounting, or mark-to-market accounting, is not new.  The debate of how to account for value has been around for decades.  However the implications of fair value accounting, versus historical accounting, are far reaching and often not grasped.  A society needs to be careful in setting accounting standards that may or may not reflect its cultural values.

Robert KempProfessorUniversity of Virginia - CC

Valuation - The Trick Is In The Fundamentals

August 25, 2008

Analysis of:Kazakh rival lifts ENRC stake to block bid | www.ft.com

To accept or reject an offer to sell all or part of a company is a challenge.  There are two issues.  First is the maximization of shareholder value.  The second is understanding the basis of conflicting valuations. 

Thomas KleinManaging MemberKleinCPA PLLC

Security Writedowns Today May Lead to Massive P&L Charges Later for C, MER and Others

April 21, 2008

Analysis of:A Way Charges Stay Off Bottom Line | online.wsj.com

Depending upon management's classification of a security (i.e., either "trading" or "available for sale"), a charge may or may not appear on the income statement in the same period as the write-down on the balance sheet. If the security is classified as a trading security, the charge on the income statement will occur in the same period as the write-down. However, if the security is classified as available for sale, the charge bypasses the income statement and is taken directly to stockholders equity. If the value of the security does not recover prior to its liquidation, the charge typically is taken in the year of liquidation. The potential charge for write-downs related to available for sale securities can be quantified by looking at the statement of stockholders equity, particularly other comprehensive income.

Robert KempProfessorUniversity of Virginia - CC

Value Creation in Banking: The Key Is Information

April 1, 2008

Analysis of:Top Tier Bonanza In Store For Core Banking Vendors | www.finextra.com

1.   Banks create value for shareholders by creating value for customers.  Much of that value to customers is embedded in information systems. 2.   The business of banking evolves quickly, forcing banks to evolve their competitive strategy and resulting advantage.  Information systems are at the heart of this evolution. 3.   The recent challenges of risk management will only accentuate the oversight of regulators, requiring banks to seek better information systems (e.g., more accurate, timely, and integrated information). 4.   As noted by the article, this will create a boom for consultants and providers of information systems.

Robert KempProfessorUniversity of Virginia - CC

Derivatives - More Disclosure Is Always Better for Financial Analysts

March 27, 2008

Analysis of:Statement of Financial Accounting Standards 161 | www.fasb.org

1.  Value is defined by risk.  Risk deals with uncertainty of the future.  How a firm manages risk is a major determinant of its value. 2.  Accounting standards are dedicated to reporting the past.  Given it is the past, there is little risk or uncertainty regarding such events.  Merely reporting the past does not give the financial analyst the insights needed. 3.  FASB 161 tries to bridge this gap between past/present and the future.  It attempts to make management disclose intent.  It attempts to answer the following question: "How will current actions and positions affect future performance?"      

Robert KempProfessorUniversity of Virginia - CC

Understanding the Pros and Cons of Pension Fund Investing - the Issue Applied to Asian Investments

February 26, 2008

Analysis of:Canada Pension Funds Turn to Asia | online.wsj.com

1.    Investing in Asia has three benefits.  First, there are the returns from investing in environments that show greater growth potential than in the West. Second, there are the returns from investing in opportunities denominated in currencies that are forecasted to appreciate. Three, there is the benefit of diversification. 2.     The costs, or risks, of investing in Asia are threefold: First, there is the risk that high growth opportunities present. Second, there is the risk of investing in a depreciating, not appreciating currency. Third, there is the asset-liability risk inherent in all financial intermediaries, particularly pension funds.

David YoungManaging DirectorValue Based Consultants

Coming to terms with fair value accounting

December 26, 2007

Analysis of:The Finer Points of Fair Value | www.aicpa.org

This article is the best summary to date of the FASB's new standard on fair value accounting.  FAS 157 is an important standard.  First, it allows (but doesn't require) companies to abandon historical cost for a broad range of financial assets and liabilities.   It also reflects a change in the FASB's philosophical approach towards a more balance-sheet oriented approach to standards setting, in contrast to the earnings measurement approach that used to dominate.  Also of interest is the principles-based nature of the standards.  In both of these ways, FAS 157 is close to what one might expect from the IFRS.  This standard is just one more step on the road to GAAP-IFRS congruence.  The article is also useful in pointing out the key issues that analysts need to understand to avoid being blindsided by reporting entities.

Page : 1234567Next1 to 10 of 63