1. column
  2. Letters

On Pooling

BY FRANK THOMAS MURPHY

Please note: This item is from our archives and was published in 2000. It is provided for historical reference. The content may be out of date and links may no longer function.

Related

No Results

TOPICS

    Uncategorized Article

“Everyone Out of the Pool,” (JofA, May00, page 45) lists several reasons the FASB has for eliminating pooling-of-interests accounting: less information, value disregards, financial statement user comparison difficulties and earnings distortions.

Much larger distortions, value disregards and comparison problems occur on a purchase transaction when historical (old) values are combined with fair market (new) values. The financial statement user has far less reliable information than when a pooling combines the historical values of two entities.

Frank Thomas Murphy, CPA
Glendale, California