mark to market Archives - Emile Woolf writes

FRAUD: SAME STORY, BIGGER NUMBERS – Enron remembered as Wirecard

  Although I have forgotten most of my own auditing experiences, a few still stand out. A client company that was in business as a confectionary retailer sold cakes over the counter, either whole or in weighed-out portions. The principal internal control was reconciling the weight of cakes leaving the bakery with the weight of […]

Read More…

PRUDENT ACCOUNTING – NEEDED MORE THAN EVER

Unaccountable accounting began three decades ago. I know, because I was there when it happened. As a member of the UK Auditing Practices Committee (APC), I acted as its observer on the Accounting Standards Committee (ASC). Professional life was simpler then: ASC set the accounting standards, effectively UK GAAP, and APC set the auditing standards. […]

Read More…

Did weird accounting support the credit disaster?

It has been argued that hi-tech accounting wizardry, including the “fair value” principle of valuing current assets at market value, has played a devilish part in the present credit meltdown. After all, it allowed banks to overstate their assets and understate their liabilities with recourse to off-balance sheet “structured investment vehicles” that everyone thought had […]

Read More…

Are the numbers verifiable? Two transatlantic papers question the fair value excursion.

My August 2006 article on the IFRS convergence fiasco generated emails indicating that mine is not a lone voice in questioning the direction that financial reporting standards are taking.  I am prompted to revisit the topic from a transatlantic perspective after reading recent papers by Ross L Watts of Sloan School, MIT, and Roy Ball […]

Read More…