Posts Tagged ‘Hans Hoogervorst’

Today is Accountant Day (aka Accounting Day).  In the hopes of coming up with something clever enough to get linked to from Going Concern and RTed on Twitter, I queried a few dozen accounting notables including professors, bloggers, journalists, regulators and Top 100 Most Influential People.

How do you intend to celebrate Accountant Day on November 10?

At least Paul Bahnson (professor at Boise State, Accounting Today columnist, and member of the 2011 Top 100 list) was honest, “I wasn’t even aware that there was any such thing as Accountant Day.”

Denny Beresford, former Chairman of the FASB, is going to work today.  Ugh.  “I’ll be attending the PCAOB Standing Advisory Group meeting in DC in the morning, flying and driving home to Athens, GA in the afternoon, and participating in a corporate board meeting in Seoul, South Korea by phone that evening.”  Denny is still working off the bills from his college toga parties.

Professors Bahnson and Ed Ketz (Penn State professor and Grumpy Old Accountants blogger), like most accountants, really know how to cut lose. Bahnson said, “I’m thinking I might put up an entry in class where the debits don’t equal the credits (on purpose!) just to celebrate.”  Ketz said, “I’m giving an exam on currency forwards, foreign translation, and options as fair value and cash flow hedges.  Should be fun.”

Ed Scribner (accounting department Head at New Mexico State University and  Funniest Accounting Professor in America), has a day long program planned:

  • Dr. John Loveland will be delivering his special address entitled, “Accountants – You Can’t Do Without Them, But I’d Certainly Like to Try.”
  • Dr. David Boje will be telling a story entitled, “Interesting Accountants I Have Known.”  (This session will be brief.)
  • Dr. Carl Enomoto will be explaining why accountants cannot have personality conflicts, by definition.
  • Dr. Janet Green will be presenting favorite bean recipes from the kitchens of HRTM.

Jim Peterson (blogger at re:Balance and audit theorist) will propose new wording for the auditor opinion:

“Having performed such calendar-reading tests as we deemed reasonable in the circumstances, it is our opinion that, in accordance with generally accepted calendar principles, Accountants’ Day is fairly likely to be observed on Thursday, October 10, 2011.

“Third parties are advised, however, that our opinion is intended for use only by those with whom we are in privity, and that they should perform such other or further due diligence as they may require or deem suitable.”

Hey Jim, very funny.

Sam Antar, the most creative accountant of his generation, (as well as convicted felon, former CFO at Crazy Eddie’s and now blogger at White Collar Fraud), says,

I will be giving thanks to Green Mountain Coffee Roasters and its auditors at PricewaterhouseCoopers. Their antics have provided me with fresh materialfor teaching how to find accounting irregularities in plain sight.

The most interesting party plans come from the regulators:  James Kroeker (SEC), Leslie Seidman (FASB), Hans Hoogervorst (IASB).  They chose not to respond to my invitation to comment, so I’m just going to make stuff up.

Hoogervorst suggests that on Accounting Day debits and credits should be optional and used only according to professional judgment.  Seidman exposed the idea of debits and credits switching sides.  Henceforth, credits are now to be located on the left side.  Kroeker is to issue a Convergence Roadmap to a party at his house.

How are you celebrating on this day?  Leave details in the comment section below.

Debit and credit – – David Albrecht

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Hans Hoogervorst

Tom Selling’s latest on Accounting Onion is about Hans Hoogervorst, leader of the International Accounting Standards Board (the organization responsible for IFRS).  “The Hans Hoogervorst IFRS Sales Pitch Hits the Road.”  Selling’s post further cements his reputation as the premier commentator on financial reporting and accounting standard setting politics.

I do not like Hans.  Hans is a career politician.  As such, we should remember the typical politician’s propensity to be willing to say anything at any time to further his agenda.

Until just less than three years ago, he knew little more than “transparency is good,” and “global accounting standards are a must.”

Now, Hans is travelling the world, trying to get all countries to unconditionally accept IFRS.  He has made recent speeches about a United States switchover.  Hans, why not start with Europe?  Europe uses a customized version of IFRS.  The reason, of course, is that to Hans, it matters not what accounting rules are in place as long as they are branded IFRS.  During a recent speech in China, Hans admitted that he decided he wanted to chair the IASB before he became interested in accounting for accounting’s sake:  “These experiences triggered a personal interest in accounting … my desire to lead the IASB as it adapts to become the global accounting standard-setter.”

Selling says it well:

For a standards setter, Hans Hoogervorst, the new IASB chairman, doesn’t know much about accounting. By his own frank admission, he wasn’t even very interested in the subject until after the financial crisis hit in 2008, and he seems almost proud to disavow a command of the details of IFRS.

Consequently, his role on the IASB is obvious: to sell IFRS to as many countries as possible. Why anyone should expect someone with his background to do that with any sort of credibility is beyond me, but his selection seems to reflect a conscious strategy on the part of the IFRS Foundation: to promote the sizzle instead of the steak.

Recently, Hans has turned his attention to China, asking it to unconditionally adopt IFRS.  During his speech, Hans said,

[W]hile Chinese GAAP is not word-for-word IFRSs, I understand that analysis by the Chinese regulator shows that for companies with dual listings in Shanghai (using Chinese GAAP) and Hong Kong (using IFRSs) the average difference in reported profit is 0.6%. The difference in term of net assets is even as smaller as around 0.2%.

Hans, that companies can report the same results under Chinese GAAP and IFRS is not an argument for why the country should switch to IFRS (Selling agrees).  Actually, that there is little difference in reported financial results is a condemnation of both sets of accounting standards.  IFRS is notorious for allowing corporate flexibility in reporting results.  Chinese GAAP is much less exacting than IFRS.  It is entirely reasonable to expect that a company can look at financial recordings and be able to paint the sky any color it wants, either chartreuse or polka dotted.  Application of general accounting rules depends upon assumptions, and assumptions depend upon intention.  If a company wants to paint the sky a particular color, it can do so under either IFRS or Chinese GAAP.  The paintings will be similar because it is only one corporate painter.

Debit and credit – – David Albrecht

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