A reader emails to point out a good Slate column from the 2002 era of Enron, WorldCom, Tyco, Global Crossing, etc. Now we have “mark-to-management” accounting endorsed by our official accounting-standards board by way of Congress by way of their financial-industry campaign donors.
I think the best way to drive home the ridiculousness of make-believe accounting is to remind folks of this hilarious 2002 piece from Slate.
I agree. Check out Rob Walker’s piece. Here’s a snippet:
These results do not reflect certain items. Loss of good health and potential mortality stemming from 62 consecutive quarters of above-plan intake of assorted spirits, tobacco, and other substances reliant on mouth-to-lung delivery systems, and miscellaneous off-book chemical and pharmaceutical substances, are addressed in a one-time write-down. Results also include the application of “good will” regarding those days, and in some cases weeks, when actual gym attendance was negatively impacted or curtailed by visits to the racetrack, where I ate oysters and drank Budweiser. Finally, a recent post-workout lunch of a 22-ounce, bone-in rib steak at Smith & Wollensky and three shots of bourbon is treated here as a non-recurring expense. I’ll never do that again! I encourage you to focus on these pro forma results as a truer portrait of the state of my health than “traditional measures,” which suggest that I have been dead for at least a year.
Mark-to-market is not that much more ridiculous.Ryan Chittum is a former Wall Street Journal reporter, and deputy editor of The Audit, CJR's business section. If you see notable business journalism, give him a heads-up at firstname.lastname@example.org. Follow him on Twitter at @ryanchittum.