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Discussion of 'The Implications of Unverifiable Fair-Value Accounting: Evidence from the Political Economy of Goodwill Accounting'

16 Pages Posted: 6 Jan 2008  

Douglas J. Skinner

The University of Chicago - Booth School of Business

Date Written: November 2007

Abstract

Ramanna (2007) provides interesting and novel evidence on how firms use contributions from their political action committees (PACs) to members of Congress as a means of lobbying for preferred positions on the two exposure drafts that led to SFAS-141 and SFAS-142. My discussion raises some concerns about his main conclusion: that pooling firms lobbied the FASB to obtain a fair value based impairment rule to facilitate their ability to manipulate financial statements. I offer a more benign explanation and make some other observations about how this line of research could proceed in the future.

Keywords: Lobbying, Fair value, Accounting Standards

JEL Classification: M41, M44

Suggested Citation

Skinner, Douglas J., Discussion of 'The Implications of Unverifiable Fair-Value Accounting: Evidence from the Political Economy of Goodwill Accounting' (November 2007). Available at SSRN: https://ssrn.com/abstract=1080589 or http://dx.doi.org/10.2139/ssrn.1080589

Douglas J. Skinner (Contact Author)

The University of Chicago - Booth School of Business ( email )

5807 S. Woodlawn Avenue
Chicago, IL 60637
United States
773-702-7137 (Phone)

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