Fasb 12,fasb 107, fasb 115,current fair value reporting,trading securities,help to maturity,available for sale, jose cintron, advance business consulting, http://mba4help.com, jose cintron

1. ACCO.721 FASB 107-115 DATE: 11/04/09 JOSE CINTRON,MBA

2. FASB “ROCKS” the Accounting World!! With Fair Value Accounting for Financial Instruments

3. There was an Investment Community Interest in Reporting Fair Values of Financial Instruments in Financial Statements.

5. Conservative

6. Simple to explain Hmmm... Historical Cost… Lower of Cost or Market… Life is good... FASB Statement No. 12, Accounting for Certain Marketable Securities

8. Not consistent with realization principle

9. Cumbersome Disclosure (FASB 107) Everything was not perfect. Accountant Before 1993

11. Does not permit analysts to gauge value and risk

12. Does not disclose assumptions for gain on sale computationsAccountant

13. 1993 FASB Statement No. 115 Accounting for Certain Investments in Debt and Equity Securities

14. Keep valuation adjustments on the balance sheet until they are earned! Three Categories: Trading securities Hold to maturity Available for sale Classify financial assets according to management intention!

15. Securities that will be held for a short period of time for trading purposes. Debt securities the company has the positive intent and ability to hold until maturity. a) debt securities not classified as held to maturity and b) debt and equity securities that are not classified as trading securities are available for sale.

17. Held to Maturity – Not recognized / P.I.

19. FASB 115,Securities with fair market value below cost basis are impairer. If impairment is determined to be other than temporary, cost basis of individual security must be written down to fair value through income statements.

22. More difficult to determine

23. More difficult to explainJose,Hmmm… Fair Value Accounting… Equity Adjustments… Change is hard...

24. “Change is hard, Jose.” FASB no.115, is here to stay. You will love no. 114

25. REFERENCES Summary of Statement No. 115,retrieved on Nov.4, 2009 from; http://www.fasb.org/summary/stsum115.shtml Financial Accounting Standard Board,retrieved on Nov.4, 2009 from; http://www.fasb.org/jsp/FASB/Page/03-16-09_otti.pdf FASB 115: it's back to the future 115,retrieved on Nov.4, 2009 from; http://www.thefreelibrary.com/FASB+115:+it's+back+to+the+future+for+market+value+accounting.-a014381134 Summary of Statement No. 107, retrieved on Nov.4, 2009 from; http://www.fasb.org/pdf/fas107.pdf