Accounitng!!!?

Question

Present your opinion on whether Generally Accepted Accounting Principles can apply to both large public companies and smaller non-public companies. Why, or why not? Be specific....

Answer 1

Small, family-run businesses should be spared the more complex standards. Accounting standards in general are moving away from their foundations (that the financial statements should REASONABLY state, etc.etc.) to hypertechnical standards that benefit nobody, for large or small companies alike. A few recent examples are the need to have an economic valuation of intangibles performed every year instead of simply amortizing them on a consistent and systematic basis, and the obsessing that is now taking place over what sort of stock option valuation model should be used, and the resulting need to hire another blasted "expert" consultant to write a justification for WHATEVER calculation method the company adopts, notwithstanding that statisticians advise us the BlackScholes and the binomial methods yield very similar results. If you're following IFRS, the requirements of FRS 32 and 39 are impossible to understand and only goes to force the co. to engage accountants at exhorbitant fees to explain or ensure compliance.