Discussion of "The implications of unverifiable fair-value accounting: Evidence from the political economy of goodwill accounting"
AbstractRamanna [2007. The implications of unverifiable fair-value accounting: evidence from the political economy of goodwill accounting, Journal of Accounting and Economics] provides interesting and novel evidence on how firms use contributions from their political action committees (PACs) to members of Congress as a means of lobbying for preferred positions on the two exposure drafts that led to SFAS-141 and SFAS-142. My discussion raises some concerns about his main conclusion: that pooling firms lobbied the FASB to obtain a "fair-value"-based impairment rule to facilitate their ability to manipulate financial statements. I offer a more benign explanation and make some other observations about how this line of research could proceed in the future.
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Bibliographic InfoArticle provided by Elsevier in its journal Journal of Accounting and Economics.
Volume (Year): 45 (2008)
Issue (Month): 2-3 (August)
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- Aboody, David & Kasznik, Ron & Williams, Michael, 2000. "Purchase versus pooling in stock-for-stock acquisitions: Why do firms care?," Journal of Accounting and Economics, Elsevier, vol. 29(3), pages 261-286, June.
- Anne Beatty & Joseph Weber, 2006. "Accounting Discretion in Fair Value Estimates: An Examination of SFAS 142 Goodwill Impairments," Journal of Accounting Research, Wiley Blackwell, vol. 44(2), pages 257-288, 05.
- Kasznik, Ron & Aboody, David & Williams, Michael, 2000. "Purchase versus Pooling in Stock-for-Stock Acquisitions: Why Do Firms Care?," Research Papers 1614, Stanford University, Graduate School of Business.
- Leftwich, Richard, 1981. "Evidence of the impact of mandatory changes in accounting principles on corporate loan agreements," Journal of Accounting and Economics, Elsevier, vol. 3(1), pages 3-36, March.
- Weber, Joseph P., 2004. "Shareholder wealth effects of pooling-of-interests accounting: evidence from the SEC's restriction on share repurchases following pooling transactions," Journal of Accounting and Economics, Elsevier, vol. 37(1), pages 39-57, February.
- Nicoleta Farcane & Delia Deliu & Maria Gheorghian, 2011. "Auditing Fair Values In A Sensitive Socio-Economical Context," Annales Universitatis Apulensis Series Oeconomica, Faculty of Sciences, "1 Decembrie 1918" University, Alba Iulia, vol. 2(13), pages 19.
- Inès Bouden & Luc Paugam & Olivier Ramond, 2011. "Les déterminants de la dépréciation du goodwill : proposition d'un cadre d'analyse," Post-Print hal-00646810, HAL.
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