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Fair Value Accounting: Insights and Issues
Fair value accounting ' sometimes used interchangeably with mark-to-market accounting ' has been criticized in some quarters as being the main cause of the current credit market turmoil. Proponents of this viewpoint contend that accounting rules were interpreted to mean that entities were required to value certain assets and liabilities, particularly marketable securities (e.g., mortgage-backed securities), at market values despite the fact that those values were established by distressed or fire-sale transactions. Such valuations, these proponents argue, resulted in these securities being written down inappropriately in financial statements significantly below their intrinsic values thereby overstating the losses incurred. These write-downs severely eroded capital in financial services companies, thus curtailing their ability to operate and lend.
To establish context, entities, particularly financial institutions, have recognized significant losses in their financial statements in 2007 and 2008 with respect to fair value write-downs. One estimate put the cumulative losses incurred by financial institutions through the third quarter of 2008 at an amount in excess of $600 billion.
The DOJ's New Parameters for Evaluating Corporate Compliance Programs
The parameters set forth in the DOJ's memorandum have implications not only for the government's evaluation of compliance programs in the context of criminal charging decisions, but also for how defense counsel structure their conference-room advocacy seeking declinations or lesser sanctions in both criminal and civil investigations.
The DOJ's Corporate Enforcement Policy: One Year Later
The DOJ's Criminal Division issued three declinations since the issuance of the revised CEP a year ago. Review of these cases gives insight into DOJ's implementation of the new policy in practice.
Use of Deferred Prosecution Agreements In White Collar Investigations
This article discusses the practical and policy reasons for the use of DPAs and NPAs in white-collar criminal investigations, and considers the NDAA's new reporting provision and its relationship with other efforts to enhance transparency in DOJ decision-making.
Bankruptcy Sales: Finding a Diamond In the Rough
There is no efficient market for the sale of bankruptcy assets. Inefficient markets yield a transactional drag, potentially dampening the ability of debtors and trustees to maximize value for creditors. This article identifies ways in which investors may more easily discover bankruptcy asset sales.
A Lawyer's System for Active Reading
Active reading comprises many daily tasks lawyers engage in, including highlighting, annotating, note taking, comparing and searching texts. It demands more than flipping or turning pages.