Let's make America competitive; outmoded accounting rules are holding U.S. industry hostage

Article Abstract:

Outmoded accounting rules are hampering the competitiveness of the American industrial sector. The Generally Accepted Accounting Principles (GAAP) creates difficulties in financial reporting by providing only a short-range perspective on investments. For one, the GAAP does not have provisions that take into consideration value changes for items as resulting from inflation or technological innovation. The conservative view held by auditors, and other preparers of financial statements, also leads to reports that are nonrepresentative of the current economic values of tangible assets. Intangible assets rarely even find their way to the balance sheets. Among the proposed solutions to enhance competitiveness of the US industrial base are the adoption of activity-based costing and the implementation of a project-based technology investment strategy.

Management, Competition (Economics), Finance, Cover Story, Small business, Technological innovations, Corporations, Corporate finance

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Let the buyer beware

Article Abstract:

A buyer wishing to purchase significant assets from a firm that may be in financial difficulties should secure documentation attesting to the fact that the seller was compensated at the fair market value of the assets acquired. A valuation report made by an independent third-party expert should provide the required documentation necessary to establish the fair market value of the acquired assets. This course of action would provide the prudent buyer with an assurance that the transaction would be protected from any possible future charges of fraudulent conveyancing in the event the seller ever goes bankrupt.

Methods, Purchasing, Interpretation and construction, Laws, regulations and rules, Column, Bankruptcy law, Fraudulent conveyances

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