Accounting for asset retirement obligations: FASB 143 explains it all. (Financial Reporting).With the long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. business trend toward a more balance-sheet oriented o·ri·ent n. 1. Orient The countries of Asia, especially of eastern Asia. 2. a. The luster characteristic of a pearl of high quality. b. A pearl having exceptional luster. 3. focus in accounting, FASB FASB See: Financial Accounting Standards Board FASB See Financial Accounting Standards Board (FASB). has fixed its attention on how entities account for obligations associated with the retirement of tangible long-lived long-lived adj. 1. Having a long life: a long-lived aunt. 2. Lasting a long time; persistent: a long-lived rumor. 3. assets. In the past, many businesses employed an income-statement approach, recognizing the costs related to such obligations ratably over an asset's life as a component of depreciation or expensing the obligations as they are incurred. FASB Statement FASB Statement A standard set by the Financial Accounting Standards Board regarding a financial accounting and reporting method. Essentially, FASB statements determine the acceptable accounting practices that Certified Public Accountants use in reporting no. 143, Accounting for Asset Retirement Obligations--which was seven years in the making--shifts to a balance-sheet approach, requiring businesses to recognize a liability for a retirement obligation when they incur To become subject to and liable for; to have liabilities imposed by act or operation of law. Expenses are incurred, for example, when the legal obligation to pay them arises. An individual incurs a liability when a money judgment is rendered against him or her by a court. it--even if that is far in advance of the asset's planned retirement. This article explains the provisions of Statement no. 143 as companies and their accountants will need to apply them. OVERVIEW OF FASB 143 In FASB's words, Statement no. 143's stated objective is to "establish accounting standards for recognition and measurement of a liability for an asset retirement obligation Asset Retirement Obligations provide for future disposal of assets as required by SFAS 143 [1]. Firms must recognize the ARO liability in the period it was acquired, generally acquisition. and an associated asset retirement cost" The new rules regarding the retirement of tangible long-lived assets include these features: * A business must recognize an asset retirement obligation for a long-lived asset at the point an obligating event takes place--provided it can reasonably estimate its fair value (or at the earliest date it can make a reasonable estimate). * The entity must record the obligation at its fair value, either the amount at which the liability could be settled in a current transaction between willing parties in an active market, or--more likely--at a substitute for market value, such as the present value of the estimated future cash flows required to satisfy the obligation. * To offset the credit portion of the asset retirement liability entry, businesses must capitalize To regard the cost of an improvement or other purchase as a capital asset for purposes of determining Income Tax liability. To calculate the net worth upon which an investment is based. To issue company stocks or bonds to finance an investment. the asset retirement costs as an increase in the carrying amount of the related long-term asset Long-term assets or noncurrent assets are those assets usually in service over one year such as lands and buildings, plants and equipment, and long-term investments. These often receive favorable tax treatment over current assets. . * Businesses must include certain costs in the income statement during the asset's life--namely depreciation on the asset, including additional capitalized Capitalized Recorded in asset accounts and then depreciated or amortized, as is appropriate for expenditures for items with useful lives longer than one year. retirement costs, and interest for the accretion The act of adding portions of soil to the soil already in possession of the owner by gradual deposition through the operation of natural causes. The growth of the value of a particular item given to a person as a specific bequest under the provisions of a will between the of the asset retirement liability due to the passage of time. RECOGNITION ISSUES Statement no. 143 applies to tangible long-lived assets, including individual assets, functional groups of related assets and significant parts of assets. It covers a company's legal obligations resulting from the acquisition, construction, development or normal operation of a capital asset. In many cases, the presence or absence of a qualifying legal obligation will be clear. Other situations will require CPAs to carefully analyze the circumstances CIRCUMSTANCES, evidence. The particulars which accompany a fact. 2. The facts proved are either possible or impossible, ordinary and probable, or extraordinary and improbable, recent or ancient; they may have happened near us, or afar off; they are public or and the statement's detailed guidance. The statement provides other guidance on the new standard's scope: * A mere plan or intention to dispose of To determine the fate of; to exercise the power of control over; to fix the condition, application, employment, etc. of; to direct or assign for a use. See also: Dispose an asset does not require recognition. * Obligations--such as environmental remediation Generally, remediation means providing a remedy, so environmental remediation deals with the removal of pollution or contaminants from environmental media such as soil, groundwater, sediment, or surface water for the general protection of human health and the environment or from a liabilities--related to the improper
* Businesses may incur retirement obligations at the inception of an asset's life or during its operating life. For example, an offshore oil-and-gas-production facility typically incurs its removal obligation when it begins operating. A landfill or a mine, however, may incur a reclamation Reclamation A claim for the right to return or the right to demand the return of a security that has been previously accepted as a result of bad delivery or other irregularities in the delivery and settlement process. obligation gradually over the life of the asset as space is consumed con·sume v. con·sumed, con·sum·ing, con·sumes v.tr. 1. To take in as food; eat or drink up. See Synonyms at eat. 2. a. with waste or the mine is dug. In other cases, the obligation may come because of the passage of laws or regulations during an asset's life, such as environmental regulations. MEASUREMENT ISSUES Under Statement no. 143, an entity must recognize an asset retirement obligation at its fair value the amount at which an informed willing party would agree to assume the obligation. However, acknowledging that a market for settling such obligations may not exist, FASB permits CPAs to estimate the obligation's fair value and says that a present value technique is often the best approach. An entity must estimate the cash flows required to settle a retirement liability and make those estimates consistent with information and assumptions "marketplace participants" would use. Companies should not allow proprietary information and internal cost structures to influence the cash flow estimates if they differ materially from market conditions. Companies must also estimate the amount and timing of the related cash flows, incorporating explicit assumptions about inflation, technology advances, profit margins, offsetting cash flows and other factors. A single point estimate of value based on these assumptions apparently will not suffice suf·fice v. suf·ficed, suf·fic·ing, suf·fic·es v.intr. 1. To meet present needs or requirements; be sufficient: These rations will suffice until next week. . A company must determine the extent to which the amounts or the timing would vary under different future scenarios and the relative probabilities of each. The scenarios CPAs consider in the present value calculation reflect uncertainties about settling a retirement obligation. These uncertainties do not, however, play a part in a company's decision whether to recognize the liability--assuming the obligation's existence is otherwise clear. Companies must discount the estimated cash flows, with all their assumptions, probabilities and uncertainties, using what Statement no. 143 calls a credit-adjusted risk-free Adj. 1. risk-free - thought to be devoid of risk riskless, unhazardous safe - free from danger or the risk of harm; "a safe trip"; "you will be safe here"; "a safe place"; "a safe bet" rate--a rate (such as that for zero-coupon U.S. Treasury U.S. Treasury Created in 1798, the United States Department of the Treasury is the government (Cabinet) department responsible for issuing all Treasury bonds, notes and bills. Some of the government branches operating under the U.S. Treasury umbrella include the IRS, U.S. instruments) adjusted upward for the effect of the entity's credit standing. A liquid, solvent solvent, constituent of a solution that acts as a dissolving agent. In solutions of solids or gases in a liquid, the liquid is the solvent. In all other solutions (i.e. , relatively unleveraged company--one with a strong credit standing--would have a smaller adjustment than an entity that is less creditworthy cred·it·wor·thy adj. Having an acceptable credit rating. cred  it·wor .All these features--assessing what the market "believes" about costs, anticipating inflation rates and technology advances, estimating probabilities for various scenarios and determining a credit-standing adjustment for the discount rate-combine to create a very subjective value. Yet, in the absence of an active market, such a present value technique should, if CPAs apply it properly, produce a reasonable and defensible de·fen·si·ble adj. Capable of being defended, protected, or justified: defensible arguments. de·fen substitute for fair value. AN EXAMPLE Exhibit 1, above, and exhibit 2, page 52, demonstrate Statement no. 143's accounting treatment using a sample asset. The asset's carrying cost Noun 1. carrying cost - the opportunity cost of unproductive assets; the expense incurred by ownership carrying charge opportunity cost - cost in terms of foregoing alternatives includes the $1 million original cost plus the capitalized retirement cost--equal to the initial liability amount--of $162,892. The retirement entry of the long-lived asset would be as follows, assuming the actual cash flows to settle the retirement obligation match those estimated. (In this and following balance-sheet illustrations, debits are denoted by "Dr." and credits by "Cr.")
Dr. Accumulated depreciation $1,162,892
Dr. Asset retirement liability 422,500
Cr. Long-lived asset 1,162,892
Cr. Cash (retirement costs incurred) 422,500
Any differences between the asset retirement liability balance and the actual retirement costs would flow through the income statement as a gain or loss on retirement. COMPARISON TO DEPRECIATION ACCOUNTING Historically, many entities have accounted for retirement obligation costs as a part of depreciation. Depreciation-based accounting includes the estimated and undiscounted cash flows related to retirement in the depreciable depreciable Of, relating to, or being a long-term tangible asset that is subject to depreciation. base allocated over the asset's useful life. Depreciation calculations also include estimated salvage salvage, in maritime law, the compensation that the owner must pay for having his vessel or cargo saved from peril, such as shipwreck, fire, or capture by an enemy. Salvage is awarded only when the party making the rescue was under no legal obligation to do so. proceeds. For most of the assets Statement no. 143 affects, retirement costs far exceed salvage, resulting in what some industries refer to as negative net salvage and also yielding a depreciable base--original cost plus estimated removal costs less estimated salvage--that exceeds the long-lived asset's original cost. Exhibit 3, page 55, summarizes depreciation accounting for the sample asset (note Statement no. 143 has superseded the treatment of obligatory obligatory /ob·lig·a·to·ry/ (ob-lig´ah-tor?e) obligate. obligatory unavoidable; something that is bound to occur. removal costs shown here). At the end of the sample asset's life, both depreciation accounting and the liability approach Statement no. 143 mandated yield the same net credit on the balance sheet. The accounting shows the credit as a liability (exhibit 2: net book value of zero less the $422,500 retirement liability), whereas depreciation accounting results in a negative--and counter-intuitive--net asset balance (exhibit 3: asset balance of $1 million less accumulated depreciation accumulated depreciation The total amount of depreciation that has been recorded for an asset since its date of acquisition. For example, a computer with a 5-year estimated life that was purchased for $2,000 would have accumulated depreciation of $800 [( of $1,422,500, and no retirement liability). Both approaches recognize the same total expenses--$1,422,500--over the asset's useful life. Under Statement no. 143, the expenses are made up of $1,162,892 in depreciation plus $259,608 of interest accretion (see exhibit 2), while depreciation expense is the only income-statement item for the depreciation accounting approach (see exhibit 3). The differences between liability accounting under Statement no. 143 and depreciation accounting arise within the asset's life due to the timing and classification of the retirement cost liability and asset and their attendant ATTENDANT. One who owes a duty or service to another, or in some sort depends upon him. Termes de la Ley, h.t. As to attendant terms, see Powell on Morts. Index, tit. Attendant term; Park on Dower, c. 1 7. expenses. In most cases these timing differences cause the pattern of expense recognition to shift from a fiat [Latin, Let it be done.] In old English practice, a short order or warrant of a judge or magistrate directing some act to be done; an authority issuing from some competent source for the doing of some legal act. line under depreciation accounting (straight-line depreciation A method employed to calculate the decline in the value of income-producing property for the purposes of federal taxation. Under this method, the annual depreciation deduction that is used to offset the annual income generated by the property is determined by dividing the of a base that includes an estimate of the retirement costs) to an upward-trending expense line under liability accounting (straight-line depreciation plus ever-increasing interest accretion resulting from the passage of time). KEY VARIABLES In implementing Statement no. 143, CPAs may have to make some potentially complex calculations that are highly sensitive Adj. 1. highly sensitive - readily affected by various agents; "a highly sensitive explosive is easily exploded by a shock"; "a sensitive colloid is readily coagulated" to several variables. Cashflow estimates. The timing and amounts of the cash flows to cover the actual costs of retiring an asset and settling the retirement obligation can vary widely. Assets such as electric power plants, oil refineries This is a list of oil refineries. The Oil and Gas Journal also publishes a worldwide list of refineries annually in a country-by-country tabulation that includes for each refinery: location, crude oil daily processing capacity, and the size of each process unit in the refinery. and mines usually have long lives. Predictions out 30 to 40 years or more inevitably will be fuzzy fuzz·y adj. fuzz·i·er, fuzz·i·est 1. Covered with fuzz. 2. Of or resembling fuzz. 3. Not clear; indistinct: a fuzzy recollection of past events. 4. . Yet entities required to implement Statement no. 143 must make educated guesses about inflation rates, labor costs, technological advances and profit margins in a way that reflects how the market would view such items. Despite the inherent subjectivity, this often is the only practical approach for a company to take when implementing Statement no. 143. These estimates require CPAs to do careful analysis and documentation, including supportable underlying assumptions. Credit-adjusted, risk-free rate Risk-free rate The rate earned on a riskless asset. . Companies must apply a "level effective interest rate." They apply this rate to a liability balance that grows each year--as interest is added, the annual interest expense (accretion) also grows. The steepness of this expense line depends on the discount rate: the higher the rate (the credit-adjusted, risk-free rate), the deeper the discounting. Deep discounting has three effects: (1) It creates a smaller amount of retirement costs for a company to capitalize as part of the asset's carrying cost, rendering See render. (graphics, text) rendering - The conversion of a high-level object-based description into a graphical image for display. For example, ray-tracing takes a mathematical model of a three-dimensional object or scene and converts it into a bitmap image. the more stable component of annual expense--depreciation--less significant; (2) it results in much smaller interest expense via accretion in the early years because the initial liability is smaller; and (3) it yields greater variation in accretion costs from early in the asset's life to later. Exhibit 4, page 56, shows various annual expense lines for the sample asset. [GRAPHIC OMITTED] THE EFFECTS OF PAST DEPRECIATION PRACTICES Statement no. 143 requires companies to make a "cumulative-effect" entry when they implement its provisions. FASB decided that, at transition, an entity should measure the fair value of a liability for an asset retirement obligation and the corresponding capitalized cost at the date the liability was initially incurred using current information, assumptions and interest rates. Companies should use that initial fair value and initial capitalized cost as the basis for measuring depreciation and interest expense front the date the liability was incurred to the date of the statement's adoption. The result: "immediate recognition ... of liability, asset, and accumulated depreciation amounts" with the net amount flowing through that period's income statement as a cumulative-effect adjustment. For entities that had not previously provided for retirement costs, this cumulative effect could be sizable siz·a·ble also size·a·ble adj. Of considerable size; fairly large. siz a·ble·ness n. .If a company owning the sample asset had not included any provision for retirement costs in its annual depreciation amounts, its accumulated depreciation balance at the end of year 4 would be $400,000 ($1 million original cost over 10 years x 4 years of depreciation). The company would record the following transition entry assuming implementation at the end of year 4 (see exhibit 2 for the balances required at that point):
Dr. Long-lived asset (capitalized cost) $162,892
Dr. Cumulative-effect adjustment 140,754
Cr. Asset retirement liability 238,490
Cr. Accumulated depreciation 65,156
If the same company had included the asset's estimated retirement costs in its depreciable base (as shown in exhibit 3), the cumulative effect adjustment upon transition at year 4 would actually be a net credit flowing through the income statement, as follows (see also exhibit 5, page 56):
Dr. Long-lived asset (capitalized cost) $162,892
Dr. Accumulated depreciation 103,844
Cr. Asset retirement liability 238,490
Cr. Cumulative-effect adjustment 28,246
The cumulative effect amounts flowing through the income statement represent, in each case, the net offset to the combined adjustment of the relevant balance-sheet items as well as a catch-up for the cumulative differences in income statement amounts recorded under the differing accounting approaches. Because the circumstances surrounding sur·round tr.v. sur·round·ed, sur·round·ing, sur·rounds 1. To extend on all sides of simultaneously; encircle. 2. To enclose or confine on all sides so as to bar escape or outside communication. n. a business and its major assets will vary widely, the effect of adopting Statement no. 143 also will vary. The interplay in·ter·play n. Reciprocal action and reaction; interaction. intr.v. in·ter·played, in·ter·play·ing, in·ter·plays To act or react on each other; interact. of the factors involved-particularly the credit-adjusted, risk-free discount rate, the age of the asset relative to its overall useful life, cash flow estimates and the adequacy of prior provisions for retirement costs--means each situation requires CPAs to do careful analysis. ACTION ITEMS Companies will find Statement no. 143's new approach to accounting for asset retirement obligations has these important implications: * A shift in the components and stability of period expenses. * A change in balance-sheet components--adding a new liability and capitalized retirement costs as part of the carrying cost of the long-lived asset, and removing accumulated depreciation of retirement-related costs embedded Inserted into. See embedded system. there. (Note: This is the case only for costs related to retirement obligations covered by Statement no. 143; retirement costs not related to obligations presumably pre·sum·a·ble adj. That can be presumed or taken for granted; reasonable as a supposition: presumable causes of the disaster. may remain a component of depreciation accounting.) * Revised depreciation expense (to remove the component intended to provide for obligatory asset retirement costs). To prepare to implement Statement no. 143--required for fiscal years beginning after June 15, 2002--entities with long-lived assets need to perform the steps listed below. (In many cases, CPAs will need to apply these steps for a company's significant individual assets on a stand-alone basis.) 1. Using the specific guidance in the statement, determine whether the entity has a legal obligation related to retirement of the long-lived asset. This essential scope issue will require CPAs to do research in many instances. 2. Use market information, if possible, to value an obligation. Otherwise, follow these three steps: * Estimate how "market participants The term market participant is used in United States constitutional law to describe a U.S. State which is acting as a producer or supplier of a marketable good or service. When a state is acting in such a role, it may permissibly discriminate against non-residents. " likely would view the costs and circumstances related to the retirement obligation (for example, labor rates, cost structures and technological advances). Since the statement does not provide any explicit guidance on how CPAs would do this, practice will vary depending on the circumstances. * Prepare a range of estimated cash flows related to settlement of the obligation and weight them for their probabilities of occurrence. * Discount the probability-weighted cash flow data to the date the liability was incurred using a risk-free interest rate Risk-Free Interest Rate Describes return available to an investor in a security somehow guaranteed to produce that return. The risk-free interest rate compensataes the investor for the temporary sacrifice of consumption. adjusted for the entity's credit standing. 3. Roll forward the balance-sheet items--liability, capitalized costs, accumulated ac·cu·mu·late v. ac·cu·mu·lat·ed, ac·cu·mu·lat·ing, ac·cu·mu·lates v.tr. To gather or pile up; amass. See Synonyms at gather. v.intr. To mount up; increase. depreciation--from the liability date to the implementation date to compute To perform mathematical operations or general computer processing. For an explanation of "The 3 C's," or how the computer processes data, see computer. the balances required at implementation. 4. Prepare a cumulative-effect adjustment entry reflecting the requisite balance-sheet amounts, with the net difference flowing through the income statement. 5. Prepare the required financial statement disclosures (a general description of the asset retirement obligation and of the associated asset; the value of any assets legally restricted for purposes of settling the obligation; and a reconciliation of the asset retirement liability balance for the period). 6. Adjust depreciation rates for long-lived assets for which the estimated retirement obligation was part of the depreciable base. Ongoing accounting oversight
Oversight may refer to:
A CLEAR REFLECTION Statement no. 143 imposes sweeping changes in how companies--and their CPAs--will have to account for asset retirement obligations. For capital-intensive Capital-intensive Used to describe industries that require large investments in capital assets to produce their goods, such as the automobile industry. These firms require large profit margins and/or low costs of borrowing to survive. entities in particular, these changes require significant analysis, the likelihood of procedural changes and, depending on past accounting practices, the possibility of material transition charges. However, and this represents the benefit that FASB believes justifies and outweighs those costs, the new statement provides a mechanism for ensuring that companies' balance sheets reflect more clearly the economic realities of retirement obligations associated with long-lived assets. EXECUTIVE SUMMARY * TO PROVIDE BUSINESSES WITH GUIDANCE ON WHEN and how to recognize a liability for asset retirement obligations, FASB issued Statement no. 143, Accounting for Asset Retirement Obligations. The statement applies to retirement obligations for tangible long-lived assets. * THE STATEMENT REQUIRES ENTITIES TO RECOGNIZE asset retirement obligations at their fair value--the amount at which an informed willing party would agree to assume the obligation. Such a market may not always exist so CPAs might need to estimate fair value. A present value technique may be the best approach. * MANY ENTITLES HAVE HISTORICALLY ACCOUNTED FOR retirement obligation costs as part of depreciation. Differences between liability accounting under Statement no. 143 and depreciation accounting arise due to the timing and classification of a retirement cost liability and asset and their attendant expenses. * COMPANIES MUST IMPLEMENT STATEMENT NO, 143 for fiscal years beginning after June 15, 2002. To implement the statement, a company will need to follow certain steps, including determining whether it has legal obligations related to the retirement of long-lived assets. This "scope" issue will require CPAs to do careful research. * THE SWEEPING CHANGES IN STATEMENT NO. 143 provide a mechanism for ensuring that companies' balance sheets more clearly reflect the economic realities of the retirement obligations associated with long-lived assets. The changes could be particularly significant for capital-intensive industries.
Exhibit 1: Asset Retirement Obligation
Measurement
Assumptions:
* Original cost--aside from the capitalized retirement cost--$1
million.
* Company incurs an obligation to retire the asset upon installa-
tion.
* Straight-line depreciation over a 10-year useful life.
* 10% credit-adjusted, risk-free rate at the time of installation.
* Three scenarios of estimated market-based cash outflows (in
year 10) to settle the obligation.
Estimated cash
Scenario outflow year 10 * Probability Weighting
A $250,000 25% $ 62,500
B 450,000 45% 202,500
C 525,000 30% 157,500
Expected cash outflow $422,500
Present value for year 0 at 10% $162,892
* Incorporating assumptions about inflation, technology and the like.
Exhibit 2: Annual Accounting Under Statement no. 143
Balance Sheet (Yearend)
Accumulated
Asset depreciation Net book
Install $1,162,892 $ -- $1,162,892
Year 1 1,162,892 116,289 1,046,603
Year 2 1,162,892 232,578 930,314
Year 3 1,162,892 348,867 814,025
Year 4 1,162,892 465,156 697,736
Year 5 1,162,892 581,446 581,446
Year 6 1,162,892 697,735 465,157
Year 7 1,162,892 814,024 348,868
Year 8 1,162,892 930,313 232,579
Year 9 1,162,892 1,046,602 116,290
Year 10 1,162,892 1,162,892 --
Retire (1,162,892) (1,162,892) --
Year 11 -- -- --
Balance Sheet (Yearend)
Net
Liability balance sheet
Install $162,892 $1,000,000
Year 1 179,181 867,422
Year 2 197,099 733,215
Year 3 216,809 597,216
Year 4 238,490 459,246
Year 5 262,339 319,107
Year 6 288,573 176,584
Year 7 317,430 31,438
Year 8 349,173 (116,594)
Year 9 384,090 (267,800)
Year 10 422,500 (422,500)
Retire -- --
Year 11 -- --
Income Statement
Depreciation Interest expense Net income
expense (accretion) statement
Year 1 $ 116,289 $ 16,289 $ 132,578
Year 2 116,289 17,918 134,207
Year 3 116,289 19,710 135,999
Year 4 116,289 21,681 137,970
Year 5 116,290 23,849 140,139
Year 6 116,289 26,234 142,523
Year 7 116,289 28,857 145,146
Year 8 116 289 31,743 148,032
Year 9 116,289 34,917 151,206
Year 10 116,290 38,410 154,700
Totals $1,162,892 $ 259,608 $1,422,500
Exhibit 3: Depreciation Accounting for Retirement Costs (Supersede
Method)
Balance Sheet (Yearend) Income Statement
Accumulated Depreciation
Asset depreciation Net book expense
Install $1,000,000 $ -- $1,000,000 $ 142,250
Year 1 1,000,000 142,250 857,750 142,250
Year 2 1,000,000 284,500 715,500 142,250
Year 3 1,000,000 426,750 573,250 142,250
Year 4 1,000,000 569,000 431,000 142,250
Year 5 1,000,000 711,250 288,750 142,250
Year 6 1,000,000 853,500 146,500 142,250
Year 7 1,000,000 995,750 4,250 142,250
Year 8 1,000,000 1,138,000 (138,000) 142,250
Year 9 1,000,000 1,280,250 (280,250) 142,250
Year 10 1,000,000 1,422,500 (422,500)
Retire (1,000,000) (1,422,500) 422,500
Year 11 -- -- --
Cumulative income-statement activity $ 1,422,500
Exhibit 5: Balance Comparison: End of the Year Four
Balance Sheet (Yearend)
Accumulated
Asset depreciation
Required for FASB 143 $ 1,162,892 $ 465,156
Pretransition balances 1,000,000 569,000
Transition adjustment $ 162,892 $ (103,844)
Dr. Dr.
Balance Sheet (Yearend)
Net book Liability
Required for FASB 143 $ 697,736 $ 238,490
Pretransition balances 431,000 --
Transition adjustment $ 266,736 $ 238,490
Cr.
Balance Sheet (Yearend)
Net
balance sheet
Required for FASB 143 $ 459,246
Pretransition balances 431,000
Transition adjustment $ 28,246
Cr. to income
statement
ERIC R. ALEXANDER, CPA (Computer Press Association, Landing, NJ) An earlier membership organization founded in 1983 that promoted excellence in computer journalism. Its annual awards honored outstanding examples in print, broadcast and electronic media. The CPA disbanded in 2000. , CMA CMA - Concert Multithread Architecture from DEC. , CFM (Cubic Feet per Minute) The measurement of air flow. Cooling fans are rated in CFM. , is a self-employed consultant in Canyon, Texas Canyon is a city in Randall County, Texas, United States. The population was 12,875 at the 2000 census. It is the county seat of Randall CountyGR6. It is the home of West Texas A&M University and Panhandle-Plains Historical Museum. , specializing in financial management, business valuation and strategic planning Strategic planning is an organization's process of defining its strategy, or direction, and making decisions on allocating its resources to pursue this strategy, including its capital and people. . His e-mail address See Internet address. e-mail address - electronic mail address is ericralexander@msn.com. RONALD RONALD Rocketborne Optical Neutral gas Analyzer with Laser Diodes R. HINER, CPA, EdD, is a professor of accounting at West Texas A&M University in Canyon. His e-mail address is rhiner@mail.wtamu.edu. |
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