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Pastimes : The Justa & Lars Honors Bob Brinker Investment Club -- Ignore unavailable to you. Want to Upgrade?

To: Justa Werkenstiff who wrote (8278)	8/31/1999 1:50:00 PM
From: Boca_PETE	Respond to of 15132

Justa W: RE: <Briefing.com at Jackson Hole for Greenspan Speech> Great post showing the pathetic reporting by the media talking heads and print media. Even with the clarification about Greenspan's observations about "the quality of reported corporate earnings", it is apparent that word has not reached Dr. Greenshades that effective 1998, accounting rules require capitalization and amortization of the costs of software developed or purchased by companies for internal use. Capitalizable costs include external direct costs of materials and supplies consumed in developing the software, and, payroll and related costs of employees who devote time to the software project. Costs not qualifying for capitalization include period costs like - General and administrative costs (expensed as incurred) - Overhead costs (expensed as incurred) - Training costs (expensed as incurred) - Costs of routine software maintenance (for corrections, updates, and routine changes incurred after software use commences) (expensed over the maintenance period). Nor did Greenspan mention the controversy over accounting for employee stock options and the fact that since 1995, the footnotes to all financial statements have been required (See FASB Standard 123) to disclose the effect on earnings had compensation expense included an expense for granted employee stock options. Also, Dr. Greenspan supported the banking community's FAILED lobbying efforts to keep the "fair value" certain derivatives off balance sheet(current practice which will sunset starting year 2001 under the new FASB Standard 133). I wouldn't get too enamored with Greenspan's accounting expertise, despite his strong views. P