Research Paper on Intangible Assets including Goodwill

Research Paper on Intangible Assets including Goodwill IFRS versus GAAP: Assessing the Issue Major sources of investment capital have long favored greater harmony and transparency in global accounting standards (Ohlgart Ernst, 2011). While world accounting standards in the modern sense originated in the US, a divergence has occurred between GAAP criteria and the prevailing international accounting standards, currently represented by IFRS criteria. The latter are now in official use in 120 nations (Tyson, 2011, p. 27). In October 2002, FASB and IASB formalized the Norwalk Agreement, to converge in their accounting rules over time (Charron Moores, 2011; Tyson, 2011). Since then, both the major accounting associations and government regulators have moved toward convergence in accounting practices. In light of this development, this paper will look at whether to recommend that the SEC maintain GAAP criteria for firms that report in the US or move to IFRS criteria, especially concerning the issue of intangible assets. The Call for Convergence After the Enron and WorldCom accounting fiascos, which â€Å"culminated in huge financial losses and decimated capital markets worldwide,† there has been vociferous pressure, especially from European firms and auditing agencies, for the US to join the growing world community of accounting practice by moving away from GAAP and toward IFRS criteria (Tyson, 2011, p. 25). This assumes that globally standardized criteria would have improved transparency in financial reporting at Enron and WorldCom, raising awareness of irregularities earlier. Thus, some have argued that IFRS standards, which rely on principles more than rules, foment more professional judgment, which creates transparency (Tyson, 2011, p. 30). Admittedly, GAAP criteria are better at industry-specific detail, but there have also been arguments that they may encourage â€Å"financial engineering† (Tyson, 2011, p. 27). Nevertheless, credible academic sources find no evidence that IFRS standards are superior to G AAP criteria (Tyson, 2011, p. 30). Effect on Intangible Assets Henry, Lin, and Yang (2007) reported that intangible assets, including both goodwill and development costs (e.g., in research and development) play a central role in determining critical measures of value for â€Å"reconciling items for both net income and shareholders’ equity† (p. 710). Because the difference between GAAP and IFRS concern intangible assets more than any other area, especially in cases of mergers and acquisitions, this concern lies at the crux of the question of whether the US should move toward the IFRS model. Goodwill refers to the intangible benefit that comes from a company’s acquiring another firm at a cost that is less than its current fair-market price (Charron Moores, 2011). The key difference between GAAP and IFRS in measuring goodwill concerns how acquirers allocate this intangible value by unit in their own accounting structures. Under GAAP criteria, â€Å"the acquirer assigns goodwill to the various reporting units of the combined entity,† but under IFRS criteria, â€Å"goodwill is assigned to the various cash-generating units† (Charron Moores, 2011, p. 50). In fact, Henry, Lin, and Yang (2007) found that the largest differences between IFRS and GAAP in calculating shareholder equity related to goodwill. Moreover, between 2004 and 2006, pensions and goodwill have dominated disparities between GAAP and IFRS accounting, despite evidence of convergence over time (Henry, Lin, Yang, 2009).Shareholders’ equity under IFRS is lower than that reported under GAAP criteria, in most cases. Because the definition of control differs between GAAP and IFRS, some events qualify as mergers and acquisitions in one system but fall short of that definition in the other (Charron Moores, 2011). GAAP looks for a mathematical majority of shares to define having a controlling financial interest. In contrast, the IFRS looks at effective control, defining control as the â€Å"power to govern the financial and operating policies of an entity to obtain benefits from its activities† (Charron Moores, 2011, p. 48). This requires judgment. To discern this, analysts must judge whether interested shareholders can appoint executives, dissolve a business unit, appoints board members, exercise special voting rights, or alter bylaws (Charron Moores, 2011). Benefits of Convergence The principle of convergence, as one of multiple paths to US adoption of IFRS criteria, involves first cooperatively adjusting GAAP and IFRS criteria, and then permitting US firms to adopt IFRS practices at a point at which the latter â€Å"would be adopting IFRS almost automatically or be very close† (Ohlgart Ernst, 2011, p. 41). The advantages of convergence include making US-based sources of capital funding more competitive in capital global markets, lower expected costs of capital overall, greater financial-reporting efficiency for US-based multinational sources of capital and auditing firms, and more transparency for investors (Tyson, 2011). Henry, Lin, and Yang (2007) noted that â€Å"the greater confidence in financial reporting† from harmonizing global accounting reporting standards â€Å"translates into a lower cost of capital† (p. 710). The pursuit of convergence between GAAP and IFRS criteria is also likely to encourage more repatriation of foreign ea rnings by US corporations (Epstein Macy, 2011). Recommendations Ohlgart and Ernst (2011) predicted that the SEC would permit a minimum of five years for US corporations to make the transition to IFRS criteria, assuming that it ultimately adopts the convergence plan. For some companies, however, the main disadvantages of convergence have to do with the time necessary to make the transition, rather than any permanent loss of financial advantage. Nevertheless, many firms will also have to adapt to new reporting systems after years of developing internal ERPs that will be vexing to rework. As Ohlgart and Ernst (2011) noted, many firms’ accounting ERPs â€Å"are a conglomeration of disparate systems pieced together over the years that will either not support a massive change,† even if such a change promises to afford substantial efficiencies at some point in the future (p. 43). Nevertheless, two-thirds of Fortune 1000 firms already favor eventually full convergence (Tyson, 2011, p. 30). While international organizations and major audit firms support proceeding with the transition to IFRS in the United States, industrial interests are far more reticent (Tyson, 2011). Most cautious are the aerospace, financial-services, and public-utilities sectors (Tyson, 2011), which have come out strongly in favor of convergence as the optimal path to adoption, with sufficient time for GAAP criteria to align with IFRS standards. Major multinational firms headquartered in the US have voiced similar concerns to those of the foregoing industry sectors. Lastly, US-based trade associations and large investment firms have come out in agreement with US-based industrial interests. In consideration of the effect on the cost of capital and more generally the benefits of having a more transparent international-accounting system, the only reasonable recommendation is to follow the advice of the foregoing US-based industrial interests. However, given that the IFRS criteria are actually the eventual offspring of accounting standards first formed in the US, a better solution is a policy of condorsement (Ohlgart Ernst, 2011, p. 42). This is a combination of convergence and the additional qualification that the FASB exercise oversight over residual changes that need to occur in both GAAP and IFRS criteria. In this way, the product may be an optimal combination of rules-based criteria and principles-based criteria, which may thus permit greater objectivity and lesser subjectivity in the accounting rules that currently prevail in IFRS criteria alone. This way, there may be an opportunity to resolve the ambiguities associated with some IFRS criteria, while otherwise purs uing a semblance of convergence in the end.

Foreign country relating to the world Essay Example | Topics and Well Written Essays - 750 words

Foreign country relating to the world - Essay Example India is one of the few countries which escaped from the damages of current global recession. India has achieved this positions through carefully planned economic and foreign policies. They have adopted a diplomatic approach to most of the problems associated with it in the region and never adopted an aggressive approach even when their sovereignty was in jeopardy. Immediately after getting freedom, India has started conscious efforts to make an international body for the non-aligned countries under the leadership Prime Minister Jawaharlal Nehru. Former Egyptian President Abdul Nazar and Yugoslav President Tito joined hands with Nehru in the formation of NAM. At the time of cold war both US and USSR tried to gain the support of NAM countries in order to expand their power. Some political analysts believe that India was more aligned towards USSR at the time of cold war, but even then India never given up their commitment towards NAM movement. After the destruction of former Soviet Union, America has started to attract India’s support in international affairs because of India’s growing stature as a world economic power. At present India is maintaining a good relationship with both America and Russia which help them in interfering in international politics effectively. â€Å"The principles of Indias foreign policy have stood the te st of time: a belief in friendly relations with all countries of the world, the resolution of conflicts by peaceful means, the sovereign equality of all states, independence of thought and action as manifested in the principles of Non-alignment, and equity in the conduct of international relations†.   (Indias Foreign Policy - 50 Years of Achievement) â€Å"Indeed, the Independence of India itself played the role of a catalyst in removing the vestiges of colonialism in other parts of the developing world, particularly in Africa† (Indias Foreign Policy - 50 Years of Achievement) India has

The History of Winter Olympic Games Term Paper Example | Topics and Well Written Essays - 500 words

The History of Winter Olympic Games - Term Paper Example The Winter Olympic Games were disrupted by both World War 1 and World War 2. Other than the games being completely canceled because of the war and the plans being suspended, there were strained relations after the war between the nations that had been at war and their allies (Wickenheiser, 2009). The Olympic Games were feared to be held in some nations such as the Soviet Union after the war for fear of reaction of the enemies of the Soviet Union. The Worlds Wars also led to world depression and hence after the wars, few nations were able to participate in the next winter Olympic Games as the rest lacked expense money. The participants even from the nations that attended were few. Doping has been a headache to the organizers of this particular sport as with many other sports. The measures taken since 1967 have been to perform random drug tests on the participants and banning those found with positive results. The most common doping drugs are the performance enhancers. The other controversy that has rocked these games is the bribing of the planning committee officials with expensive gifts in order for their countries to be selected to host the games. The most controversial and which saw 10 officials sent packing is the 2002 Salt Lake City, USA Olympics (Gerlach, 2004). Politics have always been a silent but present issue in these winter Olympic Games. Most nations still have cold war amongst themselves and they push them in the games. Some nations use the winter Olympic Games as an opportunity to show off to the nations and those which have been successful in the number of medals use this as a way to express their powers such as the US. The nations that have always had a grudge against each other go to the extent of skipping the winter games when they take place in the enemy country. Even though the politics are silent and not expressed openly, it still affects the sole purpose of the games

True Leaders Essay Example for Free

True Leaders Essay If there ever were a great leader in the history of business and management, it would be William Edwards Deming. Deming was a visionary whose concepts of effective business leadership were decades ahead of his time. It was Deming who greatly improved industrial production in the United States during World War Two and later, ironically, in Japan where his genius was given the widespread recognition it deserved. Deming coined the term â€Å"Profound Knowledge Management† which referred to the notion that successful management is based on individuals and to be successful, individuals must always be open to change and never act in a manner that would be deemed inflexible. From this, a manager can act in a leadership role similar to Deming’s leadership module. There is, however, a significant difference between leadership and its cousins supervision and management. Supervision generally refers to the oversight of employees. Management generally refers to the oversight of company and business policy. Leadership refers to the notion that the individuals that comprise the personnel of a given company have faith and confidence in the person who is making the supervisory and managerial directives. Personnel will look up to a manager who exemplifies leadership qualities. Quality leadership will always inspire and never threaten or sanction as is the case in many supervisory or managerial styles. Are true leaders rare? Yes. The reason for this is that leadership involves a great deal of innovation (as was the case with Deming) whereas supervision/management simply requires carrying out directives. Not everyone can lead, but those who can are never forgotten.

Romeo And Juliet :: essays research papers

Over the past four hundred years, the famous play, Romeo and Juliet, has inspired many readers across the globe. The classic play, written by famous playwright William Shakespeare has captured and will continue to capture people’s minds.   Ã‚  Ã‚  Ã‚  Ã‚  The main question that rises is why this play has been read for so long. The story consists of two “ star- crossed '; lovers who fall in love at first sight. One of the main reasons why this play has been so popular is because stories in those times relied more on the life and spirit of the play. For generations people saw in this play a reflection of their own life and experiences.   Ã‚  Ã‚  Ã‚  Ã‚  Another reason why this play has been successful is also because the hints of tragedy increased the suspense and irony of the play. For example, when Juliet looks upon Romeo and says;   Ã‚  Ã‚  Ã‚  Ã‚  “O God, I have an ill-diving   Ã‚  Ã‚  Ã‚  Ã‚  soul!   Ã‚  Ã‚  Ã‚  Ã‚  Methinks I see them, now   Ã‚  Ã‚  Ã‚  Ã‚  thou art below   Ã‚  Ã‚  Ã‚  Ã‚  As one dead in the bottom   Ã‚  Ã‚  Ã‚  Ã‚  of a thumb. '; (Act III, Scene V, lines 54-56) thus pointing out the hints of tragic death.   Ã‚  Ã‚  Ã‚  Ã‚  Romeo and Juliet is also a play which is full of anger, passion, and death. The secrecy of the marriage of Romeo and Juliet pointed out a form of dramatic irony. This is shown by Juliet’s “ double-edged ';phrases when Lady Capulet is denouncing Romeo. For example,   Ã‚  Ã‚  Ã‚  Ã‚  “Ay madam, from the reach of   Ã‚  Ã‚  Ã‚  Ã‚  these my hands:   Ã‚  Ã‚  Ã‚  Ã‚  would none but I might verge   Ã‚  Ã‚  Ã‚  Ã‚  my cousin’s death.'; (Act III, Scene V, line 86) or when Juliet states in an awkward way,   Ã‚  Ã‚  Ã‚  Ã‚  “indeed I never shall be satisfied with Romeo till I behold him -dead- ';   Ã‚  Ã‚  Ã‚  Ã‚  (Act III, Scene V, line 95)   Ã‚  Ã‚  Ã‚  Ã‚  O there dramatic ironies included when Romeo falls in love with Juliet, Mercutio imagines he is still in love with Rosaline. “Ah that same pale hard-hearted wench, that torments him so that he will sure run mad. '; (Act II, Scene IV, Line 4). All the dramatic ironies caused a very lively presence throughout the play and has caught the eye of many readers.   Ã‚  Ã‚  Ã‚  Ã‚  Last but not least, Shakespeare’ s writing style has also hypnotised people.

Twin Study

1. Methods and results In this study, Thomas Bouchard and David Lykken, along with their associates at the University of Minnesota, were attempting to prove if nature is the determining factor in a person’s personality or if it really is the nurturing environment. They wanted to see if twins who were separated at birth and raised in different environments would still have similar personalities, which support the theory that a person’s genes has more impact on a person’s character than the environment.In order to study their hypothesis, Bouchard and Lykken located identical twins that were separated by birth due to adoption and spent a week conducting various tests; four personality trait scales, three aptitude and occupational interest inventories as well as two intelligence tests. Through these examples and other tests, Bouchard and Lykken complied copious amounts of data on the twins. The results of the study favored the nature theory in that an overwhelming pe rcentage of the twins had similar results and personalities despite having never grown up together. . Analysis It does appear that this study’s results proved whether nature or nurture is important in the development of a person’s personality. At least this seems to have been proven in the instance of identical twins. However, there was no mention of research done involving twins raised in the same household to compare to this study’s results. I do believe that the experiment was done properly in coordination with the scientific method but that various psychologists should have replicated the experiment numerous times over time. . Criticisms As with all published findings, there were those who argued against the claims made by Bouchard and Lykken. Some members of the psychological community believed that what was published was incomplete and therefore cannot be regarded as true unless all the results are made available. In addition, some critics claim that Bouch ard and Lykken are guilty of the â€Å"equal environment assumption† which is that identical and fraternal twins are treated equally and raised in identical environments.This assumption is untrue as parents treat fraternal twins, two separately fertilized eggs versus one that split, as complete different individuals like any other siblings born at separate times. Other psychologists agreed with Bouchard and Lykken and even completed their own studies about genetic influence on people’s personalities as well as choices, and many of these studies had similar results, thus further supporting Bouchard and Lykken. 4. ConclusionThe overall meaning of this study is that the debate of nature versus nurture continues in the field of psychology and it is more a matter of interpretation of data and personal belief rather than something set in stone. Psychologists continue to follow the study’s example by investigating the impact of genetics on a person’s choices and actions such as whom they fall in love with and other complexities of human behavior. This study changed psychology in that there was a new element, genes, for psychologists to analyze for explanations about the human psyche.

Organizations and Awareness towards LGBT Rights, Equality...

America is the country of freedom, where all men and women are treated equal. Sadly, this principle is not true when it comes to one’s sexual orientation. According to the gay bullying statistics from the lesbian, gay, bisexual, and transgender (LGBT) community, â€Å"About one fourth of all students from elementary age through high school are the victims of bullying and harassment while on school property because of their race, ethnicity, gender, disability, religion, or sexual orientation.† Being set apart from the norm is the primary reason for this particular type of bullying. To stop this discrimination based on sexual orientation, working with organizations such as Campus Pride or It Gets Better Project, is a step in the right direction.†¦show more content†¦Another way of indirectly bullying someone is by excluding him or her from a social group. This type of bullying is the most common. Another type of bullying similar to indirect bullying is cyber bull ying. Cyber bullying is done over text messaging, email, websites, blogs, social media sites, etc. Jacob Flatten, a college student at University of Green Bay, admits to being bullied about his sexual orientation throughout high school. Jacob states, â€Å"I came out of the closet my sophomore year of high school and my mother was totally understanding, but my father on the other hand, was livid. Still to this day, our relationship was never truly the same.† To summarize, Jacob thought that no one would treat him differently at school but that was not the case. He said that he was never physically abused, but the emotional abuse was almost too much to bear. Jacob said, â€Å"When I had to change in the locker room for sports or gym class, I was forced to change in the bathroom stall because my male classmates felt uncomfortable changing around me.† He says that his mother would have to physically have to drag him out of bed each morning because he did not want to face another day of the emotional abuse. Sadly Jacob states, â€Å"I would get called some of the most harsh names you could think of, they are not worth ever repeating. I truly hope times have changed and teens do not have to goShow MoreRelatedThe Prevention Of Violence And Discrimination Based On Sexual Orientation And Gender Identity1713 Words   |  7 Pagesinto their judicial system, allowing the systematic oppression of the LGBT, leading to violence in the form of hate crimes and even death. The GA3 committee, however, will be dealing with the prevention of violence and discrimination based on sexual orientation and gender identity. 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