A U.S. Manager\u27s Guide to Differences Between IFRS and U.S. GAAP

International Financial Reporting Standards (IFRS) are now required for consolidated financial reports for all European Union exchange-listed companies. Officials estimated that for 2005, the initial year of EU adoption, 8,000 financial statements were prepared in accordance with IFRS for the first time. Other countries have also adopted IFRS or IFRS-equivalent financial reporting standards. IFRS differ from U.S. Generally Accepted Accounting Principles (GAAP) in many key areas. The International Accounting Standards Board (IASB) and the Financial Accounting Standards Board (FASB) are working on various convergence projects designed to reduce or eliminate differences between the two sets of reporting standards. But existing differences will likely continue for at least the next two years, and, for many accounting topics, differences are likely to last much longer. This article highlights the 20 convergence projects and summarizes the differences between the two sets of standards. In addition, differences in three topics that are not included in the convergence efforts are identified. Differences between IFRS and U.S. GAAP found in actual EU company Form 20-F filings are used to illustrate the impact of the reporting-standard differences

Pushing the Margins: A Dynamic Model of Idiosyncrasy Credit in Top Management Team Behavior

Top management teams (TMT) behave both conventionally and unconventionally to implement strategic change in organizations. These behaviors are information used by organizational stakeholders to evaluate the TMT. However, because of limited cognitive resources, the cost of cognitive changes and the inherent variability of environments and relationships, stakeholders operate using the “latitude of norms,” which provides thresholds to measure the need for reappraisal and change. We explore this process of discontinuous reappraisals by reviewing past idiosyncratic credit literature and integrate it with expectancy violations theory to propose a theory of dynamic idiosyncratic credit. Both research and managerial implications are discussed

Critical accounting policy and estimate disclosures: Company response to the evolving SEC guidance

In late 2001, soon after numerous financial reporting failures including the much publicized demise of Enron, the SEC began a series of initiatives to improve critical accounting policy (CAP) and critical accounting estimate disclosures included within the MD&A section of Form 10-K. The first announcement, in the form of cautionary guidance, was issued in December 2001. This was followed by a Proposed Rule in 2002, and additional disclosure guidance near the end of 2003. Combined, the guidance required companies to provide information that would help investors understand the impact of estimates, accounting policies and external factors on financial results. Through 2007, the SEC continued to provide guidance as to the content of CAP disclosures in the MD&A. In this study, we assess the extent to which companies responded to the initial CAP guidance, and determine the extent to which company disclosures changed with additional SEC guidance by analyzing CAP disclosures included in the 2001 and 2003 10-K filings for 112 of the Mid-Cap 400 companies. Our findings indicate that most, but not all, sampled companies included 2001 CAP disclosures consistent with the cautionary advice. We find that the disclosure content increased from 2001 to 2003, and that the disclosure quality also increased. However, some items remained underdisclosed in 2003, indicating that even after a 2-year period in which the SEC continued to provide additional guidance and reviewed company CAP disclosures, companies were not fully disclosing content identified as important by the SEC, particularly when the guidance was included in the Proposed Rule

Reorganisation of brain networks in frontotemporal dementia and progressive supranuclear palsy.

The disruption of large-scale brain networks is increasingly recognised as a consequence of neurodegenerative dementias. We assessed adults with behavioural variant frontotemporal dementia and progressive supranuclear palsy using magnetoencephalography during an auditory oddball paradigm. Network connectivity among bilateral temporal, frontal and parietal sources was examined using dynamic causal modelling. We found evidence for a systematic change in effective connectivity in both diseases. Compared with healthy subjects, who had focal modulation of intrahemispheric frontal-temporal connections, the patient groups showed abnormally extensive and inefficient networks. The changes in connectivity were accompanied by impaired responses of the auditory cortex to unexpected deviant tones (MMNm), despite normal responses to standard stimuli. Together, these results suggest that neurodegeneration in two distinct clinical syndromes with overlapping profiles of prefrontal atrophy, causes a similar pattern of reorganisation of large-scale networks. We discuss this network reorganisation in the context of other focal brain disorders and the specific vulnerability of functional brain networks to neurodegenerative disease

Perseveration and choice in Parkinson's disease: the impact of progressive frontostriatal dysfunction on action decisions.

We have previously shown that patients with Parkinson's disease (PD) perseverate in their choice of action relative to healthy controls, and that this is affected by dopaminergic medication (Hughes LE, Barker RA, Owen AM, Rowe JB. 2010. Parkinson's disease and healthy aging: Independent and interacting effects on action selection. Hum Brain Mapp. 31:1886-1899). To understand further the neural basis of these phenomena, we used a new task that manipulated the options to repeat responses. Seventeen patients with idiopathic PD were studied both "on" and "off" dopaminergic medication and 18 healthy adults were scanned twice as controls. All subjects performed a right-handed 3-choice button press task, which controlled the availability of repeatable responses. The frequency of choosing to repeat a response (a form of perseveration) in patients was related to dopamine therapy and disease severity as a "U-shaped" function. For repetitive trials, this "U-shaped" relationship was also reflected in the BOLD response in the caudate nuclei and ventrolateral prefrontal cortex. Our results support a U-shaped model of optimized cortico-striatal circuit function and clearly demonstrate that flexibility in response choice is modulated by an interaction of dopamine and disease severity

The prefrontal cortex achieves inhibitory control by facilitating subcortical motor pathway connectivity

Communication between the prefrontal cortex and subcortical nuclei underpins the control and inhibition of behavior. However, the interactions in such pathways remain controversial. Using a stop-signal response inhibition task and functional imaging with analysis of effective connectivity, we show that the lateral prefrontal cortex influences the strength of communication between regions in the frontostriatal motor system. We compared 20 generative models that represented alternative interactions between the inferior frontal gyrus, presupplementary motor area (preSMA), subthalamic nucleus (STN), and primary motor cortex during response inhibition. Bayesian model selection revealed that during successful response inhibition, the inferior frontal gyrus modulates an excitatory influence of the preSMA on the STN, thereby amplifying the downstream polysynaptic inhibition from the STN to the motor cortex. Critically, the strength of the interaction between preSMA and STN, and the degree of modulation by the inferior frontal gyrus, predicted individual differences in participants’ stopping performance (stop-signal reaction time). We then used diffusion-weighted imaging with tractography to assess white matter structure in the pathways connecting these three regions. The mean diffusivity in tracts between preSMA and the STN, and between the inferior frontal gyrus and STN, also predicted individual differences in stopping efficiency. Finally, we found that white matter structure in the tract between preSMA and STN correlated with effective connectivity of the same pathway, providing important cross-modal validation of the effective connectivity measures. Together, the results demonstrate the network dynamics and modulatory role of the prefrontal cortex that underpin individual differences in inhibitory control

Strategic Policy Choice in State-Level Regulation: The EPA's Clean Power Plan

The EPA's Clean Power Plan sets goals for CO₂ emissions rate reductions by 2030 that vary substantially across states. States can choose the regulatory mechanism they use and whether or not to join with other states in implementing their goals. We analyze incentives to adopt rate standards versus cap-and-trade with theory and simulation. We show conditions where adoption of inefficient rate standards is a dominant strategy from both consumers' and generators' perspectives. Numerical simulations of the western electricity system highlight incentives for uncoordinated policies that lower welfare and increase emissions relative to coordination

Scaling in Plasticity-Induced Cell-Boundary Microstructure: Fragmentation and Rotational Diffusion

We develop a simple computational model for cell boundary evolution in plastic deformation. We study the cell boundary size distribution and cell boundary misorientation distribution that experimentally have been found to have scaling forms that are largely material independent. The cell division acts as a source term in the misorientation distribution which significantly alters the scaling form, giving it a linear slope at small misorientation angles as observed in the experiments. We compare the results of our simulation to two closely related exactly solvable models which exhibit scaling behavior at late times: (i) fragmentation theory and (ii) a random walk in rotation space with a source term. We find that the scaling exponents in our simulation agree with those of the theories, and that the scaling collapses obey the same equations, but that the shape of the scaling functions depend upon the methods used to measure sizes and to weight averages and histograms

Generation of unique protein specifiic MRM signatures; using peptide information from alternate scanning LC-MS data to drive MRM development

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