PracticeAuditFASB should focus on Enron-style reforms

FASB should focus on Enron-style reforms

Robert Herdman, the chief accountant at the US Securities & Exchange Commission, says regulators should deal with off-balance sheet accounting rather than focus on how to account for stock options.

Speaking in a personal capacity Herdman is reported to have said the Financial Accounting Standards Board should not disrupt its attention. ‘FASB’s got its hands full,’ he said.

Rather Herdman called on the FASB to deal with special-purpose vehicle entities, such as those used by Enron to hide massive liabilities, resulting in the gas company’s eventual collapse.

Stock option accounting has come into the public interest after Coca-Cola said it would account for them as expenses on the balance sheet instead of just as a footnote.

Herdman, speaking to the FT said the debate of stock options had continued throughout the 1990s, but no method of measurement could be agreed upon.

Related Articles

The ‘uncomfortable truth’ behind FRC’s Big Four fines recommendations

Audit The ‘uncomfortable truth’ behind FRC’s Big Four fines recommendations

6d Carl Johnson, Stephensons
BDO holds off Big Four to retain top position as AIM auditor

Audit BDO holds off Big Four to retain top position as AIM auditor

7d Alia Shoaib, Reporter
FRC urged to fine Big Four firms penalties over £10m

Audit FRC urged to fine Big Four firms penalties over £10m

3w Alia Shoaib, Reporter
EY to audit Standard Chartered bank

Audit EY to audit Standard Chartered bank

1m Alia Shoaib, Reporter
KPMG replaces PwC as Croda auditor

Accounting Firms KPMG replaces PwC as Croda auditor

2m Emma Smith, Managing Editor
EY fined £1.8m over Tech Data audit

Accounting Standards EY fined £1.8m over Tech Data audit

2m Emma Smith, Managing Editor
Top 50+50: Firms post significant growth in new tax and audit rankings

Audit Top 50+50: Firms post significant growth in new tax and audit rankings

2m Emma Smith, Managing Editor
FRC closes investigation into PwC over Barclays compliance

Accounting Firms FRC closes investigation into PwC over Barclays compliance

2m Alia Shoaib, Reporter