This paper examines the circumstances that led to the incorporation of the LIFO method of inventory valuation into the tax law in 1938 and 1939. An understanding of why the LIFO method was adopted after decades of initial opposition by revenue officials may lend perspective to the current policy...

In the USA there have been calls for greater conformity between the rules producing tax accounts and those used for financial reporting purposes. A number of benefits are claimed for this so-called 'book-tax conformity', including reduced compliance costs and better opportunities for monitoring....

Kirk, Reppenhagen, and Tucker (2014) find that investors use individual analyst forecasts as additional earnings benchmarks. We investigate whether executives manage earnings to beat these individual benchmarks. Using year-end effective tax rate (ETR) manipulation as our setting, we find that...

Recent corporate accounting reporting scandals and aggressive corporate tax shelters have led for calls for regulatory reform. One such call is to conform (or reduce the gap between) the calculation of book and taxable income. Proponents of conformity focus on perceived benefits while ignoring...

Income reported to shareholders (book income) and income reported to the U.S. Internal Revenue Service (taxable income) are alternative measures of U.S. corporate economic performance discussed in recent research, academic texts, and by U.S. legislators. In measuring economic performance,...

Last June, the private Financial Accounting Standards Board implemented a new standard that requires companies that compile balance sheets to show changes in a derivative's value as an asset or loss, even if the derivative remains in an open position. This new standard radically conflicts with...

The power of financial accounting to shape corporate behavior is underappreciated. Positive accounting theory teaches that even cosmetic changes in reported earnings can affect share value, not because market participants are unable to see through such changes to the underlying fundamentals, but...

This is Professor Cunningham's Introduction to his renowned edited collection of Warren Buffett's famous letters to shareholders of Berkshire Hathaway Inc. The collection was originally prepared for a symposium held in New York City in 1997 and has been regularly updated through five editions,...

Insurance contracts often - or even regularly - contain both an insurance component and a so-called deposit component, i.e., they combine insurance coverage with a certain kind of saving process. Due to this feature insurance contracts are difficult to report on in financial statements and...

Is Accounting Standard 22 (AS 22) on 'Accounting for taxes on income', insofar as it relates to deferred taxation, inconsistent with and ultra vires the provisions of the Companies Act, 1956, the Income-tax Act, 1961 and the Constitution of India? This was the question before the Apex Court of...