Because, you know, it’s sorta tricky and it didn’t really turn out so well for Corzine & Co.
The SEC is in talks with the Financial Accounting Standards Board, which sets accounting standards, about “repurchase-to- maturity” agreements that MF Global used in off-balance-sheet accounting, Schapiro said today during a hearing before the U.S. Senate Agriculture Committee in Washington. “We are talking with FASB about whether we need more disclosure of those,” Schapiro said.
Senator Kent Conrad (D-ND) seems a little more urgent:
“How is it possible that someone is able to bet the farm here, multiple times, and it disappears from the balance sheet because of this repo-to-maturity technique?” asked Senator Kent Conrad, a North Dakota Democrat, noting that the technique made it appear as though the risk had been “sold.”
“That is a loophole so big you can drive a Mack truck through it,” Conrad said. “If that’s not closed, we should ask ourselves what we’re doing.”
I think we all know what a lot of people at the SEC are doing.
MF Global Accounting Technique Under Review, Schapiro Says [BBW]
A recommendation on whether U.S. companies should switch to international accounting rules will take a few more months, the Securities and Exchange Commission’s chief accountant said Monday. The SEC’s staff had been expected to make a recommendation by year-end on whether U.S. companies should adopt the global rules, known as International Financial Reporting Standards. But the staff needs “a few additional months” to complete its work, SEC Chief Accountant James Kroeker said. [