How fair is fair?

The credit crunch and the financial crisis reopened the old fair-value debate and its mark-to-market methods

By Christian Bellavance, Editor-in-chief

Two years after the collapse of worldwide markets the debate rages on: if there is no market, does that mean that an asset has no value? And, more importantly, how do you value this asset in a meaningful way?

The issue and the lobbying became so political that even the Federal Accounting Standards Board, the US accounting standards-setter, made changes to its rules to accommodate a menacing Congress and forced the rest of the world to seriously look at their standards. Surprisingly or not, the issue still has not been resolved. We thought it would be a good idea to ask two respected academics to look at the true value of fair-value accounting and its mark-to-market rules. Michel Magnan, from Concordia University in Montreal, and Dan Thornton, from Queen’s University in Kingston, Ont., collaborated and wrote this month’s cover story, “FVA: smoke & mirrors?” (p. 18). They examine the issue from the points of view of management, investors and regulators and come up with interesting conclusions. A must read.

Some of you might remember that we asked CA students to respond to an informal survey to find out how entrants to the profession had changed over the past 15 to 25 years. Not surprisingly, most had a degree in a related subject and 59% worked for a Big Four firm. But we also found an interesting subgroup of older candidates with backgrounds that had nothing to do with accounting. They are parents, airplane pilots and entrepreneurs who decided to make a change in their lives and careers and thought the CA profession had a lot to offer. Meet Yellowknife’s Samantha Merritt, former bush pilot; Marie Alexandre-Gingras, who decided to use the CA path to learn English and become bilingual; veteran soldier Jonathan Gallo and others who shared their past, present and future with writer Lorie Murdoch in “Destination: CA” (p. 26).

This month’s Regulars section features articles on harmonized sales tax (p. 34), education (p.37), assurance (p. 43), standards (p. 49) and finance (p. 52).

We all know smart phones and PDAs such as BlackBerrys or iPhones are increasingly used to access the Web. But Jim Carroll discovered a catch: the reason there are so many apps for the iPhone is that its browser isn’t very user-friendly. If you count on your website to bring you business, this is not good news. Read what Carroll did about that in his Netwatch column (p. 12). In Outlook (p. 60), Marcel Côté revisits the origins of the 2008 financial crisis and the following global recession to point out that now that it appears to be behind us, all seems to be forgotten and the culprits are out to do it all again.