<br />
I think a decision will have to be made about<br />
whether we should simply ignore those differences<br />
and adopt the IFRS approach, or whether we should<br />
develop a plan to work out the differences.<br />
<br />
what public policy objectives it should satisfy, is a very crucial<br />
issue. And it is one that I know the SEC staff is looking at in<br />
their work plan. If we don't have agreement on that fundamen-<br />
tal issue, then there may not be acceptance of international stan-<br />
dards in our country.<br />
CPAJ: I know that, during your tenure, there has been a lot<br />
of pressure with regard to the purpose of financial reporting;<br />
some believe it should provide financial stability.<br />
Herz: Yes, I have spoken and written fairly extensively on<br />
that subject. First, I think that sound, transparent reporting that<br /> <a title="The CPA Journal - February 2011 page 1" href="http://viewer.zmags.com/publication/205d12e6?page=1">www.cpaj.com February 2011</a> www.cpaj.com February 2011<a title="The CPA Journal - February 2011 page 2" href="http://viewer.zmags.com/publication/205d12e6?page=2"></a> <a title="The CPA Journal - February 2011 page 3" href="http://viewer.zmags.com/publication/205d12e6?page=3"></a> <a title="The CPA Journal - February 2011 page 4" href="http://viewer.zmags.com/publication/205d12e6?page=4">CONTENTSfebruary 2011 </a> CONTENTSfebruary 2011 <a title="The CPA Journal - February 2011 page 5" href="http://viewer.zmags.com/publication/205d12e6?page=5">vol. LXXXI/no. 26PERSPECTIVES20IN FOCUS</a> vol. LXXXI/no. 26PERSPECTIVES20IN FOCUS<a title="The CPA Journal - February 2011 page 6" href="http://viewer.zmags.com/publication/205d12e6?page=6"> PublisherJOANNE S. BARRY Ar</a> PublisherJOANNE S. BARRY Ar<a title="The CPA Journal - February 2011 page 7" href="http://viewer.zmags.com/publication/205d12e6?page=7">Mark Your Calendar for FAE'sMay and June Confere</a> Mark Your Calendar for FAE'sMay and June Confere<a title="The CPA Journal - February 2011 page 8" href="http://viewer.zmags.com/publication/205d12e6?page=8">PERSPECTIVESstandards settingAccounting</a> PERSPECTIVESstandards settingAccounting<a title="The CPA Journal - February 2011 page 9" href="http://viewer.zmags.com/publication/205d12e6?page=9">publisher's column Trouble Bre</a> publisher's column Trouble Bre<a title="The CPA Journal - February 2011 page 10" href="http://viewer.zmags.com/publication/205d12e6?page=10">(Continued from page 6)variable-interest entitie</a> (Continued from page 6)variable-interest entitie<a title="The CPA Journal - February 2011 page 11" href="http://viewer.zmags.com/publication/205d12e6?page=11">dards, especially those also identifiedabove, an</a> dards, especially those also identifiedabove, an<a title="The CPA Journal - February 2011 page 12" href="http://viewer.zmags.com/publication/205d12e6?page=12">pended. The report concluded that fairvalue acco</a> pended. The report concluded that fairvalue acco<a title="The CPA Journal - February 2011 page 13" href="http://viewer.zmags.com/publication/205d12e6?page=13">ment of FASB Statement No. 140, (ASC860-10) and </a> ment of FASB Statement No. 140, (ASC860-10) and <a title="The CPA Journal - February 2011 page 14" href="http://viewer.zmags.com/publication/205d12e6?page=14">successfully. Up until the May 2010 expo-sure dr</a> successfully. Up until the May 2010 expo-sure dr<a title="The CPA Journal - February 2011 page 15" href="http://viewer.zmags.com/publication/205d12e6?page=15"> IFRS in the GeneralBusiness Curriculum:Why Sh</a> IFRS in the GeneralBusiness Curriculum:Why Sh<a title="The CPA Journal - February 2011 page 16" href="http://viewer.zmags.com/publication/205d12e6?page=16">ics, approximately 60% of respondents saidthey h</a> ics, approximately 60% of respondents saidthey h<a title="The CPA Journal - February 2011 page 17" href="http://viewer.zmags.com/publication/205d12e6?page=17">become tomorrow's investors, and they will not be</a> become tomorrow's investors, and they will not be<a title="The CPA Journal - February 2011 page 18" href="http://viewer.zmags.com/publication/205d12e6?page=18"> Private Company Accounting: AConcept W</a> Private Company Accounting: AConcept W<a title="The CPA Journal - February 2011 page 19" href="http://viewer.zmags.com/publication/205d12e6?page=19">istic sought, especially when it comes witha muc</a> istic sought, especially when it comes witha muc<a title="The CPA Journal - February 2011 page 20" href="http://viewer.zmags.com/publication/205d12e6?page=20">financial instruments but also to exponentiallyg</a> financial instruments but also to exponentiallyg<a title="The CPA Journal - February 2011 page 21" href="http://viewer.zmags.com/publication/205d12e6?page=21">practice management Use Newslettersto</a> practice management Use Newslettersto<a title="The CPA Journal - February 2011 page 22" href="http://viewer.zmags.com/publication/205d12e6?page=22">InFocus</a> InFocus<a title="The CPA Journal - February 2011 page 23" href="http://viewer.zmags.com/publication/205d12e6?page=23">Recollections onStandards Setting,Convergence, </a> Recollections onStandards Setting,Convergence, <a title="The CPA Journal - February 2011 page 24" href="http://viewer.zmags.com/publication/205d12e6?page=24"> The movement towardIFRS is still going forward</a> The movement towardIFRS is still going forward<a title="The CPA Journal - February 2011 page 25" href="http://viewer.zmags.com/publication/205d12e6?page=25">and credit impairments of debt securities—a signi</a> and credit impairments of debt securities—a signi<a title="The CPA Journal - February 2011 page 26" href="http://viewer.zmags.com/publication/205d12e6?page=26"> I think a decision will have to be made about</a> I think a decision will have to be made about<a title="The CPA Journal - February 2011 page 27" href="http://viewer.zmags.com/publication/205d12e6?page=27"> I believe that, over time, continuing geoecono</a> I believe that, over time, continuing geoecono<a title="The CPA Journal - February 2011 page 28" href="http://viewer.zmags.com/publication/205d12e6?page=28">ACCOUNTING & AUDITINGstandards setting</a> ACCOUNTING & AUDITINGstandards setting<a title="The CPA Journal - February 2011 page 29" href="http://viewer.zmags.com/publication/205d12e6?page=29">all audit opinion letters included a going-conce</a> all audit opinion letters included a going-conce<a title="The CPA Journal - February 2011 page 30" href="http://viewer.zmags.com/publication/205d12e6?page=30"> EXHIBIT 1Chronolog</a> EXHIBIT 1Chronolog<a title="The CPA Journal - February 2011 page 31" href="http://viewer.zmags.com/publication/205d12e6?page=31">of replacement financing” as aspects of acompreh</a> of replacement financing” as aspects of acompreh<a title="The CPA Journal - February 2011 page 32" href="http://viewer.zmags.com/publication/205d12e6?page=32">Critics argued that the time horizon is too long </a> Critics argued that the time horizon is too long <a title="The CPA Journal - February 2011 page 33" href="http://viewer.zmags.com/publication/205d12e6?page=33">ended time frame in the U.S. legal envi-ronment </a> ended time frame in the U.S. legal envi-ronment <a title="The CPA Journal - February 2011 page 34" href="http://viewer.zmags.com/publication/205d12e6?page=34">ACCOUNTING & AUDITINGfinancial reporti</a> ACCOUNTING & AUDITINGfinancial reporti<a title="The CPA Journal - February 2011 page 35" href="http://viewer.zmags.com/publication/205d12e6?page=35">statement users are deceived if the currentrepor</a> statement users are deceived if the currentrepor<a title="The CPA Journal - February 2011 page 36" href="http://viewer.zmags.com/publication/205d12e6?page=36">Testing for CEM Testing for the presence of CEM</a> Testing for CEM Testing for the presence of CEM<a title="The CPA Journal - February 2011 page 37" href="http://viewer.zmags.com/publication/205d12e6?page=37"> Numerous articles document the over-all usefu</a> Numerous articles document the over-all usefu<a title="The CPA Journal - February 2011 page 38" href="http://viewer.zmags.com/publication/205d12e6?page=38">law, the expected frequency of zeros occur- s</a> law, the expected frequency of zeros occur- s<a title="The CPA Journal - February 2011 page 39" href="http://viewer.zmags.com/publication/205d12e6?page=39"> Once the earnings figures have beenentered int</a> Once the earnings figures have beenentered int<a title="The CPA Journal - February 2011 page 40" href="http://viewer.zmags.com/publication/205d12e6?page=40">ACCOUNTING & AUDITINGauditingGoo</a> ACCOUNTING & AUDITINGauditingGoo<a title="The CPA Journal - February 2011 page 41" href="http://viewer.zmags.com/publication/205d12e6?page=41">Under the purchase method, the purchas-er compar</a> Under the purchase method, the purchas-er compar<a title="The CPA Journal - February 2011 page 42" href="http://viewer.zmags.com/publication/205d12e6?page=42">Management by Avoiding or ReducingGoodwill Impai</a> Management by Avoiding or ReducingGoodwill Impai<a title="The CPA Journal - February 2011 page 43" href="http://viewer.zmags.com/publication/205d12e6?page=43">whether goodwill non-impairment isassociated wit</a> whether goodwill non-impairment isassociated wit<a title="The CPA Journal - February 2011 page 44" href="http://viewer.zmags.com/publication/205d12e6?page=44">TAXATIONstate & local taxation2010 St</a> TAXATIONstate & local taxation2010 St<a title="The CPA Journal - February 2011 page 45" href="http://viewer.zmags.com/publication/205d12e6?page=45">loss can be claimed in addition to the stan-dard</a> loss can be claimed in addition to the stan-dard<a title="The CPA Journal - February 2011 page 46" href="http://viewer.zmags.com/publication/205d12e6?page=46">TAXATIONfederal taxationThe Anatomy of </a> TAXATIONfederal taxationThe Anatomy of <a title="The CPA Journal - February 2011 page 47" href="http://viewer.zmags.com/publication/205d12e6?page=47">eyewear from the price of the indoor tan-ning se</a> eyewear from the price of the indoor tan-ning se<a title="The CPA Journal - February 2011 page 48" href="http://viewer.zmags.com/publication/205d12e6?page=48">FINANCEmarkets & investmentsMark-to-Ma</a> FINANCEmarkets & investmentsMark-to-Ma<a title="The CPA Journal - February 2011 page 49" href="http://viewer.zmags.com/publication/205d12e6?page=49">financial metrics have become functions ofmark-t</a> financial metrics have become functions ofmark-t<a title="The CPA Journal - February 2011 page 50" href="http://viewer.zmags.com/publication/205d12e6?page=50">Because the value of Level 2 derivativegains is </a> Because the value of Level 2 derivativegains is <a title="The CPA Journal - February 2011 page 51" href="http://viewer.zmags.com/publication/205d12e6?page=51">done with available–for-sale securities) wasunne</a> done with available–for-sale securities) wasunne<a title="The CPA Journal - February 2011 page 52" href="http://viewer.zmags.com/publication/205d12e6?page=52">What's Different After SFAS 133and SFAS 140? </a> What's Different After SFAS 133and SFAS 140? <a title="The CPA Journal - February 2011 page 53" href="http://viewer.zmags.com/publication/205d12e6?page=53">out more and more money in their questfor yield,</a> out more and more money in their questfor yield,<a title="The CPA Journal - February 2011 page 54" href="http://viewer.zmags.com/publication/205d12e6?page=54"> In other words, maintaining leverage inthe pr</a> In other words, maintaining leverage inthe pr<a title="The CPA Journal - February 2011 page 55" href="http://viewer.zmags.com/publication/205d12e6?page=55">■ A 5% decline in asset value leads to a50% de</a> ■ A 5% decline in asset value leads to a50% de<a title="The CPA Journal - February 2011 page 56" href="http://viewer.zmags.com/publication/205d12e6?page=56"> We do not operate in frictionless mar-kets wh</a> We do not operate in frictionless mar-kets wh<a title="The CPA Journal - February 2011 page 57" href="http://viewer.zmags.com/publication/205d12e6?page=57">Heisenberg principle. The analogy men-tioned by </a> Heisenberg principle. The analogy men-tioned by <a title="The CPA Journal - February 2011 page 58" href="http://viewer.zmags.com/publication/205d12e6?page=58">MANAGEMENTcorporate finance</a> MANAGEMENTcorporate finance<a title="The CPA Journal - February 2011 page 59" href="http://viewer.zmags.com/publication/205d12e6?page=59">from the significant liabilities that states are</a> from the significant liabilities that states are<a title="The CPA Journal - February 2011 page 60" href="http://viewer.zmags.com/publication/205d12e6?page=60">Because states are becoming more aggressive in th</a> Because states are becoming more aggressive in th<a title="The CPA Journal - February 2011 page 61" href="http://viewer.zmags.com/publication/205d12e6?page=61">also run afoul of unclaimed propertylaws. A demu</a> also run afoul of unclaimed propertylaws. A demu<a title="The CPA Journal - February 2011 page 62" href="http://viewer.zmags.com/publication/205d12e6?page=62">MANAGEMENTcorporate financeCaptive Insu</a> MANAGEMENTcorporate financeCaptive Insu<a title="The CPA Journal - February 2011 page 63" href="http://viewer.zmags.com/publication/205d12e6?page=63">ance company or that are presently self-insured </a> ance company or that are presently self-insured <a title="The CPA Journal - February 2011 page 64" href="http://viewer.zmags.com/publication/205d12e6?page=64">investment income of the captive will besubject </a> investment income of the captive will besubject <a title="The CPA Journal - February 2011 page 65" href="http://viewer.zmags.com/publication/205d12e6?page=65">■ Revenue Ruling 2002-90 discusses thepayment </a> ■ Revenue Ruling 2002-90 discusses thepayment <a title="The CPA Journal - February 2011 page 66" href="http://viewer.zmags.com/publication/205d12e6?page=66">example of how this arrangement wouldwork. In Ex</a> example of how this arrangement wouldwork. In Ex<a title="The CPA Journal - February 2011 page 67" href="http://viewer.zmags.com/publication/205d12e6?page=67">RESPONSIBILITIES & LEADERSHIPcorporate </a> RESPONSIBILITIES & LEADERSHIPcorporate <a title="The CPA Journal - February 2011 page 68" href="http://viewer.zmags.com/publication/205d12e6?page=68">needs of current generations without com-promisi</a> needs of current generations without com-promisi<a title="The CPA Journal - February 2011 page 69" href="http://viewer.zmags.com/publication/205d12e6?page=69">cial way. The sustainability philosophy weighssh</a> cial way. The sustainability philosophy weighssh<a title="The CPA Journal - February 2011 page 70" href="http://viewer.zmags.com/publication/205d12e6?page=70">ties and needs of each group to make it lesslike</a> ties and needs of each group to make it lesslike<a title="The CPA Journal - February 2011 page 71" href="http://viewer.zmags.com/publication/205d12e6?page=71"> The latest version of the GRISustainabilit</a> The latest version of the GRISustainabilit<a title="The CPA Journal - February 2011 page 72" href="http://viewer.zmags.com/publication/205d12e6?page=72">the company that they may not have heardbefore a</a> the company that they may not have heardbefore a<a title="The CPA Journal - February 2011 page 73" href="http://viewer.zmags.com/publication/205d12e6?page=73">or reviews of historical financial statements.Th</a> or reviews of historical financial statements.Th<a title="The CPA Journal - February 2011 page 74" href="http://viewer.zmags.com/publication/205d12e6?page=74">TECHNOLOGYwhat to bookmarkWebsite of t</a> TECHNOLOGYwhat to bookmarkWebsite of t<a title="The CPA Journal - February 2011 page 75" href="http://viewer.zmags.com/publication/205d12e6?page=75">nects problems with the current tax systemto a V</a> nects problems with the current tax systemto a V<a title="The CPA Journal - February 2011 page 76" href="http://viewer.zmags.com/publication/205d12e6?page=76">ClassifiedPROFESSIONAL OPPORTUNITY l BUSINESS l T</a> ClassifiedPROFESSIONAL OPPORTUNITY l BUSINESS l T<a title="The CPA Journal - February 2011 page 77" href="http://viewer.zmags.com/publication/205d12e6?page=77">PROFESSIONAL CONDUCTEXPERTPROFESSIONAL CONDUC</a> PROFESSIONAL CONDUCTEXPERTPROFESSIONAL CONDUC<a title="The CPA Journal - February 2011 page 78" href="http://viewer.zmags.com/publication/205d12e6?page=78">SITUATIONS WANTEDA & A Technical Review Servic</a> SITUATIONS WANTEDA & A Technical Review Servic<a title="The CPA Journal - February 2011 page 79" href="http://viewer.zmags.com/publication/205d12e6?page=79">Classified Rates Rates & Word Count: B</a> Classified Rates Rates & Word Count: B<a title="The CPA Journal - February 2011 page 80" href="http://viewer.zmags.com/publication/205d12e6?page=80"> </a> <a title="The CPA Journal - February 2011 page 81" href="http://viewer.zmags.com/publication/205d12e6?page=81">ECONOMIC & MARKET DATAmonthly upd</a> ECONOMIC & MARKET DATAmonthly upd<a title="The CPA Journal - February 2011 page 82" href="http://viewer.zmags.com/publication/205d12e6?page=82">EDITORIALa message from the editor-in-c</a> EDITORIALa message from the editor-in-c<a title="The CPA Journal - February 2011 page 83" href="http://viewer.zmags.com/publication/205d12e6?page=83"></a> <a title="The CPA Journal - February 2011 page 84" href="http://viewer.zmags.com/publication/205d12e6?page=84"></a>