Thursday, June 23, 2011

IFRS and (un)fair value (contd..)

Lie of those who are pushing for IFRS nailed.

Comment on AS7 by Delloite partner -

"Percentage of completion method is a leap of faith," says N Venkatram, partner, Deloitte Haskins & Sells , an audit and advisory firm. "A lot of it is based on what other professionals certify."

IF this AS is flawed because one cannot rely on what a professional certifies then the entire IFRS is flawed as the entire accounting is at the mercy of "professionals" and how they "value" balance sheet items!!

Basically I dont know what scam or financial tragedy the regulators are waiting to happen before they decide to junk the IFRS.

As i keep saying retain historical cost accounting and use IFRS as an analytical tool for all listed entities to facilitate one common platform for comparision.

Monday, June 6, 2011

Anti corruption - the demands - an analysis

1. To bring back in the nation Rs. 400 trillion (US$ 9 trillion) of black money which is a national wealth. - this cannot be more than the debt generated by the govt and the sum of money supply - assuming that only politicians and businessmen (and that too only some among them) are corrupt/ create black money - the actual amount may be in the region of $300-400Billion

1.1. Create a law to declare money stashed in foreign accounts as national assets. - one more law. all the best.

1.2. Create a law for foreign account policy where each citizen having a foreign account has to disclose complete information. - already there in FEMA. enforce it.

1.3 Sign US Convention against Corruption, thus paving way for getting black money back. - that convention works for the US as they have the military strength to chase down those who dont repond to enquiries under this convention. is our military capable?

1.4 Recall high denomination currency i.e., 500 and 1000 Rupee notes and make 100 Rupee note as sparse as possible. - no issues with this - but not practicable. i fear this dilutes the value of the other demands.

2. To stamp out corruption fully by enacting stringent laws for a capable Lok Pal Bill which should have three important points? - there are already enough laws - they arent enforced for a multitude of reasons - this lok pal will meet the same fate - just another law. try to set accountability targets and more transparent reporting procedures for existing laws - that would be more meaningful.

2.1 It should be able to punish any official irrespective of designation if found guilty. - already exists. only constitutional authorities, PM and president are not covered except by impeachment law. i personally feel that the crimes that these people can be tried for has to be preset in parameters of value, hardship etc etc. the jobs they do is not easy and there are times when the rules are ignored to get a result. this latitude at this level is required otherwise we wont have people running the show - rather a gaggle of people and that is to be avoided at all costs as no "decisions" will ever be made. the answer for this is that the procedure for election/ appointment of these people has to be made more inclusive/ transparent. the current persident has a lot of unanswered questions on integrity - but was still wlected simply because the congress has the numbers - same with the CVC who had to resign rather uncerimoniously etc etc. these were done just because the party in power could get away with it.

2.2. Any person should be able to file FIR against corruption and if proofs are provided then Lok Pal should be able to take action against the guilty. - anybody already can file an FIR - make it automatic by sms/ online etc.

2.3. Once fast track court declares a person guilty of corruption then he or she should be given harsh punishment like death sentence or life imprisonment if corruption involves crores or lakhs of Rupees. It should have provision of declaring all assets of such person as national assets. - death penalty? what if the person is innocent. its enough if the assets are attached - the family has to prove through ITR's what they have earned on their own - rest will be presumed to be tainted money and confiscated.

3. To end foreign laws, customs and culture prevailing in the independent Bharat so that every Indian can get economic and social justice. We should follow Mahatma Gandhi’s book named Hind Swaraj mentioning that after independence we need to remove British system and adopt Bhartiya system. - what??? you must be joking. whatever the differences are - i am sure these can be debated and if found functional/ practicable they can be recommended and passed as law by parliament.

3.1. We need to abolish Land Acquisition Act 1984 because by using this Act the government is exploiting farmers. A farmer who is the producer of food is not respected and is getting killed daily by wrong government policies. We need to impose complete ban on genetically modified food which is dangerous for the health of citizens of this nation. - GMO's , vacines have to go. as for land acquisition - see how the devil in that can be removed - without a due process for land acquisition even what they are getting today they will not get tommorow.

3.2. On the language issue the whole nation is suffering because 99% of people do not know English. When countries like Japan, China, France, Germany, Denmark, Russia, etc. educate their citizens in their own language and produce doctors, scientists, engineers, etc. then why we cannot do so in our own national and native languages. Each of our languages has more words than any foreign language. Why we are neglecting and giving such a low importance to our own languages. Technological innovations and inventions do not depend upon a language, it is a function of human intellect and mind and the world is a witness that Bhartiya’s thinking and mind is one of the best in the world. Language of law, justice, science, engineering, medicine, etc. should be in our national or regional languages then only smart kids of poor people will be able to become scientists, doctors and engineers. - local panchayats etc can vote the language they want their kids to learn in. no issues here. resent it when this is forced as national federal policy.

3.3. Why are we given Macaulay’s education system which was created to make Indians as Englishmen and why 34735 laws are created by British still imposed on this nation? Why people of this country are still tortured and humiliated by using those laws in the same way as British used to do. - no issues - lets sit down and review each and every law and expunge those not functional and retain those that are needed for maintaining order and harmony in society.

3.4. When Bharat has given the world physics, chemistry, biology, mathematics, all social sciences, law and justice system, astrology, astronomy, astro-physics, social structure, time –days, years, etc., names of planets, economics, a cultured society and highly advanced philosophy, and spirituality to the whole world then why are we always taught that everything is developed by western world. We ought to give highest preference to our own culture. - very general - kindly be more specific - jingoism only dilutes the value of the other demands - one has to be clear, focused and rational in demands.

3.5. Although democratic system is best in the world but it has its demerits too. Had we not have this faulty law and order system in our country then such a big conspiracy would not have been created, and so much corruption and such a bad condition of our people would not have happened. So those people who are doing this conspiracy in the name of democracy and are looting this nation by corruption, it is imperative to change them and such a system. Funding of election, mandatory voting and electing the Prime minister directly by the citizens of this nation should be there. Thus only honest people will come to power and then only strong democracy and high value parliament will be formed. We want to make it clear that we do not want to change the Constitution of India created by Dr. Bhimrao Ambedkar but want to change the system created by British and still followed. Example Land acquisition act was not created by Late Shri Bhimrao Ambedkar but by the British and so was Macaulay’s education system. - so who decides who is honest - you? dont think so - democracy is still the best. maybe we can have a system that the PM is elected from a pool of independents and that the political parties can only send ministers based on their representations. worth looking at.