Archive for outubro \23\UTC 2008

A ameaça as normas contábeis

outubro 23, 2008

Europe poses threat to global accounting rules

By Jennifer Hughes in London and Nikki Tait in Brussels

Financial Times – 17/10/2008 – Asia Ed1 – 17

Growing pressure on the International Accounting Standards Board could lead Europe into developing its own regional rulemaker, in a move that would kill off the long-running effort to develop a single set of global accounting rules.

The IASB this week gave into pressure from the -European Union and eased its rules on fair value accounting, but an EU-wide meeting next week could see it presented with a “wish list” of further demands to which it could not accede.

Some fear that any -resulting stand-off between the two bodies could allow groups hostile to the IASB’s accounting rules to call for a European standard setter instead of the IASB.

The IASB sets accounting rules for more than 100 countries, including those under the EU umbrella.

There is thought to be -support among the French and Italian financial -communities for such a move, but it is opposed by some of the world’s biggest banks, including HSBC.

“It is absolutely essential that there is a single body of international accounting standard setters. It would be a considerable step backwards and most regrettable if we went to regional rules just as convergence on a single global set of standards is looking like a reality,” said Douglas Flint, chief financial officer of HSBC.

The wish list compiled at the EU meeting is likely to cover a series of issues linked to fair value accounting, the controversial process whereby financial institutions have to mark most of their assets at market prices. These have plunged as a result of the credit crunch, forcing many banks into losses and undermining the capital reported on their balance sheets.

The danger for the IASB is that the list will contain requests, such as rule changes, that it has already dismissed and cannot re-visit without damaging its credibility.

Banks are seeking further clarification over this week’s rule changes, which will allow some to shift holdings from fair value to amortised cost, a treatment that would smooth out market volatility. They are also likely to ask to be able similarly to shift assets containing embedded derivatives.

“Without trying to cause a problem the IASB may not be able to deliver what is asked because it would be severely criticised for both giving in and producing bad accounting standards,” warned Peter Wyman, a partner at PwC.

The European Banking Federation was emphatic that it would like further changes to be initiated by the international standard-setter. However, pressure could still be applied by the threat of an EU carve-out. However, the Commission can only remove parts of the rules, not add new clauses.

“We could then have a situation in Europe, in this most critical year-end period, where we would have in effect only a limited standard on financial instruments and an accounting free-for-all,” said Mr Wyman, who warned a carve out could make accounts far harder to compare by limiting the guidance available.

Anúncios

Europa aprova mudanças

outubro 19, 2008

Debate to ease fair value accounting intensifies

Hughes, Jennifer

16 October 2008

Financial Times – Asia Ed1 – 17

It will ease the strain on banks’ balance sheets, won’t cost the taxpayer a penny and is quick and relatively painless, apart from a handful of upset accountants.

The answer: relax fair value accounting, where companies have to mark most of their financial holdings to market prices.

Throughout the credit crunch this debate has grown, spilling over from academia into the banking world. In the current convulsions it has stepped up a gear and gone political.

Roughly, the debate lines up banks alongside politicians, particularly French and Italian, calling for some easing of fair value. On the other side are most regulators, accountants and investors. Gordon Brown, the UK prime minister, is also in this category.

Yesterday, the reformers got at least some of what they wanted, with the European Union poised to ratify changes made by the International Accounting Standards Board designed to even up its standards with US GAAP (generally accepted accounting principles) and in effect constituting an easing of its rules. Those who want the changes claim that fair value has undermined banks’ balance sheets by forcing them to report assets at current weak market prices even though the banks have no intention of selling them and in fact expect values to recover. Supporters of fair value claim that a balance sheet should simply reflect current economic reality, however nasty that is.

This week’s alterations will allow some more reclassification of assets from fair value to “held to maturity”, a category where gains are spread steadily over the lifetime of the asset and values are only written down if they are permanently impaired. But the banking lobby does not yet seem satisfied. Groups in both Europe and the US have smelled blood and are pushing for even more.

European industry lobbying for the changes made this week was fierce, with hints that politicians should end the IASB’s power in favour of some regional body.

In the US, the American Bankers Association called on the Securities and Exchange Commission to overrule the US accounting standards setter, claiming that the group “still refuses to recognise the realities of the current situation” and describing the current markets as “distressed”.

What we have here is a number of banks protesting because they do not like the answer. Both US and international accounting standards already include leeway for illiquid markets and allow for the use of other factors beside current market price.

This very issue was addressed by the IASB last month, when an expert advisory panel produced guidance on valuations in illiquid markets with reference to the credit crunch. However, the group, which included big banks and insurers alongside auditors and regulators, produced a definition of “distressed” or “firesale” which is so narrow as to almost never apply.

So, for “distressed” in banking lobby parlance read “depressed” markets and be wary of their misuse of technical terms. No-one can disagree the latter is true, but it doesn’t have the same get-out-of-jail-free status with the auditors as “distressed”.

The banking lobby is also confusing the role of accounts. These should simply be a true and fair record of management’s stewardship of the business. How the owners, regulators and tax authorities that read accounts choose to interpret them is their choice. Complaining about what the accounts show, when we’re talking about a system supported by such users of accounts as investors and regulators, is akin to blaming a torch for shining a light on the mess in your cupboard.

Comunidade Européia aprova mudanças

outubro 19, 2008

EU regulators back emergency change to bank accounting rules

By Nikki Tait in Brussels and Jennifer Hughes in London

16 October 2008

Financial Times – Asia Ed1 – 15

Accounting rules blamed by some banks for exacerbating the financial turmoil look set to be eased across the European Union, bringing the 27-country bloc in line with changes agreed by international accounting rulemakers.

An EU regulators’ committee in Brussels voted unanimously in favour of accepting the emergency changes made by the International Accounting Standards Board on Monday. These will give banks more leeway in how they value certain assets whose prices have plunged.

Lawmakers in the European parliament then quickly endorsed the vote, while member states also gave their unanimous support. This means the changes, which are optional, can now apply to calculations of banks’ third-quarter results if they wish.

Under the rule change, financial institutions would be able to “reclassify” certain instruments. This means they can move them from their trading books, where they must be marked at “fair”, or current, market values, to their banking books. Here, they can be reported at amortised cost – so any further falls in market prices would not have to be reported, and any gains would be spread over the lifetime of the assets.

The IASB changes followed heavy pressure from European banks and politicians. European companies had complained that US rules gave their American rivals greater flexibility.

The issue was picked up by EU finance ministers last week, who urged international accounting standard boards to work together and “welcomed the readiness” of Brussels to take appropriate action “as soon as possible”. They demanded that the reclassification issue be solved by the end of the month.

However, there were fears discrepancies could arise between the approach taken by the London-based IASB and EU rulemakers, but that worry appeared to recede yesterday. The financial community, however, remains divided about the wisdom of easing up on fair value accounting.

Those in favour include some banks and insurers who believe their balance sheets are being weakened unnecessarily. Those against include many regulators, auditors and some investors, who think that using market prices reflects current economic reality, however harsh that may be.

Uma visão geral da crise e da contabilidade

outubro 16, 2008

Mark-to-market accounting exacerbates the crisis

Don Stammer

The Australian 15/10/2008 – 5 – Wealth – 1

THE enduring crisis in financial markets has brought to everyday use words such as “sub-prime”, “toxic assets”, “securitisation” and “wholesale funding”.

“Mark-to-market accounting” will soon join this list. Mark-to-market accounting did not cause the credit crisis — which reflects excessive lending and the earlier neglect of risk — but it has exacerbated it. And changes to this accounting standard are likely to play a small role in easing the grip from tight credit.

In mark-to-market accounting, a wide range of assets (and some liabilities) are valued at their current market prices.

Where the market prices of loans or securities decline, the value of these assets in the accounts of financial institutions, managed funds and hedge funds has to be written down — reducing profits and shrinking their capital bases.

In normal times, mark-to-market accounting operates reasonably well. During a financial crisis, however, the market prices for some loans and securities — even those with little risk on their interest payments or repayments of principal — can plunge because of a few transactions in an illiquid market.

In turn, the value of quality securities, including corporate debt or mortgage securities that carry AAA-ratings, has to be written down in the balance sheets of the financial institutions and funds that hold them — even though there is little risk of loss when the loans or securities mature. The Bank for International Settlements — often called the central bank for central banks — has suggested that the existing accounting standard could be overstating the expected losses on AAA-rated sub-prime mortgage securities by as more than 50 per cent.

The Bridgewater group, a US fund manager, warns that “ending the credit crisis will be highly unlikely without some type of accounting accommodation”.

“Because mark-to-market accounting on existing assets threatens bank capital today, it increases solvency concerns today, which raises funding costs and accelerates the need to sell assets today, this depresses the prices of those assets, which threatens capital and raises funding costs.”

As part of its recent package of measures to address the credit crisis, the US Congress has insisted on an early review of mark-to-market accounting.

Of course, the main action to alleviate the credit crisis will still have to come from the huge rescue package announced recently in the US, from further moves by European authorities to support strained banks, and from other central banks making bold cuts to their interest rates — as the Reserve Bank did last week.

But a change in accounting standards that avoided the shortcomings of mark-to-market but that still preserved the integrity of financial accounts would present a less magnified dimension to the woes facing investment markets — and make some contribution towards reviving credit flows, which are disastrously constrained.

An understanding of how the accounting standards require loans and securities to be valued in the balance sheets of banks and other financiers also helps in any assessment of how much, in the end, the recently announced bailout of US banks and other lenders will cost the US taxpayer.

The US Treasury, which can borrow at interest rates of 2 per cent on medium-dated securities, is likely to be able to buy distressed assets at prices above the levels at which they are currently recorded on the books of banks and other financial institutions and earn a reasonable return on them — and even show a small profit — as the loans mature.

Nearer to home, there’s an effect from mark-to-market accounting that applies to many Australian investors. A number of managed funds that invest in corporate bonds and other interest-bearing securities, and which are soundly managed, have had to reduce their unit prices for two reasons.

One is that the market prices have dropped for some of their quality, but illiquid, investments, particularly when the funds were selling investments to finance withdrawals.

Also, market prices declined on their holdings of quality non-government securities as interest rates on these securities rose relative to those paid on government securities.

Bonds and mortgages on which there is no default must eventually rise back to their pre-determined values.

As Warren Bird of Colonial First State Global Asset Management likes to put it, a bond that falls in value from say 100 cents in the dollar to 95c hasn’t permanently lost 5c; anyone who holds, or invests in, that bond after it has fallen in price to 95c will eventually see that 5c gain as part of their total return. (In technical language, they will receive the coupon interest payments as scheduled plus the amortisation of the bond to its termination value.)

Investors can expect a recovery in the return on managed funds that hold quality corporate bonds and mortgage-backed securities, as these assets close in on their maturity dates. Mark-to-market accounting might at times be viewed as arcane, but it’s important in several ways that matter.

Dr Stammer chairs Praemium Limited and the Investment Committee of INGIM’s Portfolio Solution Group. The views are his alone.

Efeito da ajuda 2

outubro 15, 2008

Entrada do governo acaba com era do deslumbramento em Wall Street

Valor Econômico – 15/10/2008

O histórico investimento do governo americano em Wall Street é um sinal do declínio das finanças modernas, e promete menos risco, contracheques mais magros e o enterro da audaz auto-imagem de Wall Street. “É uma mudança revolucionária – participação do governo, supervisão estatal. Eu não acho que as pessoas realmente compreendem a magnitude disso”, disse Peter J. Solomon, ex-banqueiro que agora dirige seu próprio banco de investimentos. O plano do Departamento do Tesouro dos Estados Unidos para adquirir fatias dos principais bancos e garantir suas dívidas provavelmente significará “mais restrições sobre o risco e mais reserva de capital, e, portanto, menor rendimento no longo prazo”, disse num relatório a clientes o analista David Trone, do banco de investimentos Fox-Pitt, Kelton. Num universo cheio de motoristas particulares, entregas de sushi no meio da noite e ternos cortados sob medida, existe a sensação de que os excessos logo se tornarão coisa do passado.

E que isso já deve começar no fim do ano, quando a maioria dos bancos deve cortar pessoal. As mudanças são graves por causa da natureza desta crise. Em outras anteriores, como o colapso da bolha da internet depois de 2000, Wall Street teve poucas perdas, em parte porque as firmas não contavam com bilhões em ações de tecnologia em seus próprios balanços. A última debacle do mercado que ameaçou várias empresas importantes ocorreu em 1990, quando o colapso do mercado de “junk bonds”, ou títulos de alto risco, derrubou o banco de investimento Drexel Burnham Lambert Inc., que acabou precisando ser socorrido pelo First Boston Corp, hoje parte do Credit Suisse. Mike Holland, administrador de fortunas da Holland & Co., firma de investimentos de Nova York, compara o cenário atual com os anos 70, quando inflação crescente e juros altos sucederam o otimismo agressivo e a prosperidade dos anos 60. O rendimento das bolsas acabou indo por água abaixo. Na próxima década, disse Holand, veremos “menos casas nos Hamptons (balneário chique de Nova York), iates e festas na Sardenha”, reduzindo o “fascínio por Wall Street e pelo mundo dos bancos de investimentos”. Solomon, de 70 anos, começou a carreira em Wall Street na Lehman Brothers em 1960, quando a firma ocupava um acanhado edifício de 12 andares e o departamento inteiro de banco de investimentos ficava num único andar. “Comprávamos nossos próprios almoços e andávamos de metrô”, diz ele. Mas tudo mudou nas décadas seguintes, quando o setor financeiro conquistou uma fatia maior da economia americana. O crescimento estava ligado, em parte, às montanhas de capital emprestado que Wall Street podia usar em suas operações e para oferecer crédito. Os lucros explodiram, assim como os salários e a importância cultural. Em 2006, 37% dos formandos da Harvard Business School rumaram para Wall Street, ante 26% em 2004. À medida que a economia desmorona e a economia desacelera, o sentimento muda. O canal de TV a cabo CNN tem anunciado um programa no horário nobre chamado “Dez Mais Procurados: Culpados pelo Colapso”, acusando ex-executivos do alto escalão da Lehman Brothers Holdings Inc. e da American International Group Inc., assim como Christopher Cox, o presidente da SEC, a comissão americana de valores mobiliários, e até o ex-senador republicano Phil Gramm, este último por conta de seu papel na liberalização de Wall Street, em décadas passadas. Solomon traça a gênese da crise, comparada por ele ao estouro de um rebanho de búfalos rumo a um despenhadeiro, à abertura de capital das maiores firmas de Wall Street. A Merrill Lynch abriu o capital em 1971, o Morgan Stanley em 1986 e a Goldman Sachs em 1999. “A partir daí é que se uniu responsabilidade limitada com acesso ilimitado ao capital, a partir daquele momento é que Wall Street começou a correr até cair de cara no chão”, disse Solomon. Agora os contribuintes, como investidores no negócio, não tolerarão mais tanto risco, diz ele. “A compra e venda de ações, que corresponde a uma boa fatia de nosso negócio, não vai mais se recuperar e isso prejudicará imensamente as margens”, disse um banqueiro do alto escalão de uma das firmas que receberá investimento do governo. E, quando o potencial de lucro se esvanece, os bancos são forçados a entrar em acordos de fusão, dizem analistas, reduzindo mais ainda o número de vagas e os salários.

Efeito da ajuda 1

outubro 15, 2008

Tesouro concentra capital dos bancos

15/10/2008

Valor Econômico

O novo plano de socorro a bancos apresentado ontem pelos EUA transformará o Tesouro americano em importante acionista de algumas das maiores instituições financeiras do país, um movimento agressivo cujo objetivo é restaurar a confiança de investidores e reativar o mercado global de crédito. O Tesouro investirá US$ 250 bilhões para injetar capital diretamente nos bancos em troca de participações acionárias. Metade irá para oito grandes bancos que aceitaram ser os primeiros a entrar no programa. O restante irá para os que se candidatarem nas próximas semanas. Milhares de bancos menores, cooperativas de crédito e outras instituições financeiras poderão participar. Quatro bancos receberão US$ 25 bilhões cada: Citigroup, JPMorgan Chase, Bank of America e Wells Fargo. Dois bancos de investimento que estão se convertendo ao varejo, Goldman Sachs e Morgan Stanley, terão US$ 10 bilhões cada. O Bank of New York Mellon terá US$ 3 bilhões e o State Street, US$ 2 bilhões.

É possível que o plano transforme o Tesouro no maior acionista individual dessas instituições, dependendo das condições em que os aumentos de capital forem feitos e da eventual participação dos atuais acionistas e de outros investidores nas operações. Ontem, US$ 25 bilhões representavam um quarto do valor de mercado do Citigroup. O plano reproduz vários elementos dos pacotes de salvamento lançados nos últimos dias na Europa e que os EUA relutaram em seguir. “Lamentamos ter que tomar essas ações”, afirmou o secretário do Tesouro, Henry Paulson, ao anunciar o plano. “Mas é o que precisamos fazer para restaurar a confiança no nosso sistema financeiro.” Os US$ 250 bilhões equivalem a mais da metade de tudo o que bancos americanos e europeus conseguiram levantar de capital novo desde o começo de 2007, quando começaram a reconhecer os enormes prejuízos gerados pelo estouro da bolha do mercado imobiliário americano. Mesmo assim, o plano oferece apenas uma fração do volume de recursos que muitos analistas acreditam que ainda será necessário para reforçar as reservas de capital dos bancos e compensar as perdas ainda não contabilizadas. O FMI estima que os bancos vão precisar de US$ 675 bilhões nos próximos anos. Os US$ 250 bilhões fazem parte do pacote de US$ 700 bilhões que o Tesouro apresentou em setembro para salvar o sistema financeiro. A intenção original era usar o dinheiro para comprar ativos ruins que comprometeram a saúde dos bancos, ajudando-os a limpar os balanços. O Tesouro ainda não sabe como organizar os leilões para adquirir esses ativos. Levará semanas para acertar os detalhes. Nos últimos dias, o aprofundamento da crise e as medidas tomadas na Europa convenceram o governo americano a aceitar a idéia de que injetar capital nos bancos poderia ser uma resposta mais simples e eficaz. Teoricamente, os US$ 250 bilhões permitiriam alavancar US$ 2,5 trilhões em empréstimos em condições normais, num cálculo conservador. Mas ainda é cedo para saber o impacto que o apoio do governo terá sobre a oferta de crédito nas condições atuais, com os EUA e outras economias avançadas em recessão ou muito perto dela. Outra medida anunciada ontem pelos EUA ataca esse problema por outra frente. A Corporação Federal de Seguro de Depósitos (FDIC), agência governamental que protege os correntistas contra o risco de falência dos bancos, vai garantir também, temporariamente, dívidas dos bancos e depósitos mantidos pelas empresas em contas usadas para pagar salários e fornecedores. Essas garantias incluirão papéis que os bancos poderão emitir a partir desta semana, e até junho de 2009, para buscar financiamento no mercado. O objetivo principal do governo é fazer os bancos voltarem a emprestar entre si, o que deixou de ocorrer nas últimas semanas. A medida também ajuda o governo a ganhar tempo, evitando uma corrida aos bancos mais frágeis. Em junho, havia 117 bancos na lista de observação da FDIC, que garante depósitos de 8,4 mil instituições. Os bancos que aceitarem ter o governo como sócio dinheiro também terão de aceitar limites para a remuneração de executivos, uma exigência que o Congresso americano fez para tornar politicamente viável a aprovação do socorro aos bancos. Funcionários do Tesouro sugeriram aos bancos que o efeito prático desses limites será pouco significativo.

Nobel para Krugman

outubro 15, 2008

No Brasil, americano recebe elogios de todos os lados
Valor Econômico – 14/10/2008
A escolha de Paul Krugman para o Nobel de Economia de 2008 agradou os economistas brasileiros, tanto os ortodoxos como os heterodoxos. Os analistas ouvidos pelo Valor destacaram a importância da nova teoria do comércio internacional, considerada criativa e inovadora. Os seus estudos sobre a localização das atividades econômicas e sobre crises cambiais também receberam elogios. Professora da Escola de Economia de São Paulo (EESP) da Fundação Getúlio Vargas (FGV), Eliana Cardoso destaca o fato de Krugman ter introduzido a questão dos ganhos de escala e da competição imperfeita para a teoria do comércio internacional. “Ele coloca a teoria dos jogos dentro da área de comércio”, diz Eliana, que conviveu com Krugman na época em que fazia o seu doutorado no Massachusetts Institute of Technology (MIT). Ela concluiu o seu em 1979 e ele, em 1977. “Todos os professores o consideravam brilhante.
Ele tem uma cabeça excepcional e é muito respeito no mundo acadêmico.” O economista Aloisio Araújo, professor da Escola de Pós-Graduação em Economia (EPGE) da Fundação Getúlio Vargas (FGV), diz que a nova teoria de comércio internacional é importante, entre outros motivos, para entender as trocas entre os países desenvolvidos. A teoria clássica das vantagens comparativas explica por que um país rico se relaciona com um país pobre, mas não por que há muitas trocas comerciais entre os EUA e os países da Europa. “É um modelo importante, que não foi refutado”. Também professor do Instituto Nacional de Matemática Pura e Aplicada (Impa), Araújo destaca que a importância do modelo de competição imperfeita desenvolvida por Avinash Dixit e Joseph Stiglitz (laureado com o Nobel em 2001) para os estudos de Krugman sobre o comércio internacional. O professor Carlos Eduardo Gonçalves, da Faculdade de Economia, Administração e Contabilidade (FEA) da USP, também aponta a importância da teoria de comércio internacional. Segundo ele, o modelo de Krugman sugere que, em determinadas circunstâncias, a adoção de medidas protecionistas pode levar a um aumento de bem-estar na economia. Mesmo assim, nota Gonçalves, o americano continuou a defender o livre comércio. Um dos pontos é que os benefícios do protecionismo se dariam em casos bastante específicos, de difícil definição. O pensamento de Krugman também agrada o professor Luiz Gonzaga Belluzzo, da Unicamp. “O prêmio foi merecido”, diz ele, que considera o americano “eclético e não dogmático”, o que ajudaria a explicar por que ele agrada tanto heterodoxos como ortodoxos. Além do trabalho sobre comércio internacional, Belluzzo ressalta os estudos de Krugman sobre crises cambiais, analisando situações de países que mantinham regimes com câmbio fixo. Para o professor David Kupfer, da Universidade Federal do Rio de Janeiro (UFRJ), Krugman tem uma “produção muito vasta, de alta qualidade”. Ele enfatiza o fato de o americano estudar o funcionamento da economia real. Num momento de grave crise financeira, esse pode ter sido o recado que a Academia Sueca quis transmitir, acredita ele, notando que, nos últimos anos, foram premiados vários economistas com forte preocupação matemática e estatística. Para Eliana, engana-se quem vê em Krugman um economista heterodoxo. “A modelagem e o modo de entender a economia são totalmente ortodoxos”, diz Gonçalves. Independentemente de alguma motivação política na escolha de Krugman, crítico ácido do governo Bush, todos os economistas ouvidos pelo Valor consideraram o prêmio acertado. A brilhante história acadêmica de Krugman justificaria o Nobel, ainda que hoje ela esteja em segundo plano, ofuscada por sua atuação como articulista do “The New York Times”. Gonçalves, por exemplo, considera que o economista às vezes peca por cair em excessivo proselitismo político. “Mas se trata de um gênio, com uma criatividade absurda”, diz, elogiando livros de Krugman voltados a um público mais amplo, como “Internacionalismo Pop”. Além de um eventual caráter político ao prêmio, também chama a atenção o fato de que Krugman ganhou o Nobel sozinho – em muitas ocasiões, a Academia premia mais de um economista, como em 2007, quando Leonid Hurwicz, Eric Maskin e Roger Myerson foram os vencedores. Eliana e Araújo dizem que o israelense Elhanan Helpman poderia ter sido escolhido ao lado de Krugman, com quem escreveu um livro tido como fundamental como “Market Structure and Foreign Trade”. De qualquer modo, os dois consideram que o pioneirismo de Krugman justifica um prêmio só para ele. Eliana destaca as recentes análises de Krugman sobre a crise financeira. “Os seus pontos de vista são bastante esclarecedores”, afirma ela. Em seu blog e nos artigos para o “New York Times”, Krugman foi um dos primeiros a apontar graves defeitos no plano de socorro financeiro desenhado pelo secretário do Tesouro, Henry Paulson. Krugman defendeu desde o começo a injeção de capital nos bancos em troca de ações preferenciais. Há nove anos, Krugman se envolveu numa polêmica com Arminio Fraga, na época em que o brasileiro foi convidado para assumir o Banco Central (BC). Num artigo para a revista “Slate”, Krugman insinuou que Arminio passara informações privilegiadas a George Soros, seu ex-patrão. Autoridades brasileiras teriam dito a Arminio que não pretendiam deixar de pagar a dívida do país. A informação teria sido repassada a Soros, e este teria aproveitado para comprar títulos brasileiros. Arminio escreveu uma dura carta à “Slate”, dizendo que a acusação era falsa e que Krugman não se preocupou em verificá-la com ele. Krugman se retratou formalmente, pedindo desculpas a Arminio por sua falta de cuidado.

Pensão e Contabilidade

outubro 15, 2008

Drive for clearer accounting continues

Jennifer Hughes

13 October 2008

Financial Times

Surveys FNM1

19

Since pensions were first dragged onto company balance sheets in the UK almost a decade ago with large parts of the industry kicking and screaming, the hullaballoo has rarely died down.

That move, by the UK Accounting Standards Board caused a furore in part because of its timing. Although many did not in principle like the light shed on scheme funding, the most immediate problem was that it came into force as the dotcom bubble burst, meaning that tumbling stock markets savaged the value of pension holdings, making deficits look even larger.

Accounting rulemakers believe that by making the funding, and how it is managed, clearly visible on the balance sheet, investors and other company stakeholders will have a clearer picture of the risks and demands of pension schemes.

However, many in the industry have linked the accounting changes with the significant rise in the closure of defined benefit schemes to new entrants in recent years as companies feel they can no longer face the risk of these volatile liabilities skewing their balance sheets. In the UK, less than a sixth of DB schemes are now open to new entrants, down from half in 2003, shortly after the ASB’s rules were introduced.

The more recent introduction of similar rules in the US by the Financial Accounting Standards Board in 2006 has attracted less controversy, perhaps because the switch from DB to defined contribution plans was well under way. But talk of convergence between US and international accounting standards may heat up the debate in the US as tighter rules are put on the table for discussion.

This year, the UK’s ASB came back with another suggestion that could have a dramatic effect on reported funding levels; in a paper produced in January, the board suggested changing the rate at which future liabilities are discounted – a move that will make the liabilities look bigger.

The good news for scheme sponsors is that the ASB no longer sets their accounting rules; that is now down to the International Accounting Standards Board.

The bad news is that Sir David Tweedie, the man blamed by newspapers for “destroying” pensions when he led the ASB in introducing the previous changes, has moved from the ASB to head its international counterpart, which is considering altering its rules on the topic.

That pensions pose a volatility risk to balance sheets is not in doubt. Recent market gyrations are a case in point. According to Watson Wyatt, the actuarial consultants, the combined schemes of FTSE 100 companies had a deficit of £12bn (€15bn, $21bn) at the end of August, but by the middle of last month, that had swung to a £7bn surplus.

The reason was a surge in corporate bond yields – which links directly to the ASB’s latest proposals. The future liabilities of a scheme are currently discounted to their present value using a blend of AA-corporate bond yields, which are designed to reflect the returns expected on fund assets.

However, in the current crisis corporate borrowing costs have spiked sharply higher as investors have demanded higher returns for the greater risk they perceive. In spite of that rising risk, the bigger number has served to reduce scheme deficits, meaning it has worked in the opposite way to that intended, since expected fund returns have not changed and if anything given the current market, are under some threat.

What the ASB has proposed is using the much lower “risk-free” rate, usually the yield on long-term government bonds. The suggestions triggered a wave of protest at the extra burden this would place on schemes as their reported deficits leapt overnight.

The National Association of Pension Funds said the idea could double the liabilities reported by “young” pension schemes while Pension Capital Strategies, a consultancy, calculated the “risk-free” rate would have raised the combined deficit of FTSE 100 schemes from £8bn to £100bn.

Although the ASB no longer has the power to change the rules directly, it does have a high profile in the pensions accounting world and strong links with the IASB. The IASB’s own current review has focused on removing “corridor” accounting, which allows some smoothing of the effect of market moves. But in a second phase, it is likely to address the thorny issue of discount rates.

“Given the revolution that has already been launched by pensions and accounting standard setters in their drive to reflect economic reality, it is easy enough to see more changes coming,” says Dawid Konotey-Ahulu of Redington Partners, a pensions consultancy, who warns that if anything, the credit crunch will speed up the ongoing trend towards making full market volatility transparent for investors.

IASB watchers say there are criticisms of its current proposals, which include new methods for classifying schemes, but that it would be unfair to say the pensions world was speaking with one voice.

“There are grumblings about how accounting has forced the closure of DB schemes, and I’m sure there will be more, but the experts don’t actually speak with one voice on this, you get some widely divergent views,” says one accounting rulemaker, who staunchly defended the central premise of transparency in what must be a warning to anyone hoping to change accounting’s current path.

He adds: “It’s the job of accountancy to portray as fairly as possible the true economics of what is going on. DB pensions have always been expensive to provide and they’ve only become more so given longevity and other factors. Accounting has just made that cost more transparent.”

AIG mostra recuperação 3

outubro 8, 2008
AIG: Days after $85bn rescue, insurer hosted banquets
Andrew Clark New York
8 October 2008

The Guardian

6

The world’s largest insurance company, AIG, spent $440,000 on a lavish corporate retreat at one of California’s top beachside resorts a few days after accepting an $85bn emergency loan from the US government to stave off bankruptcy.

Details of the week-long getaway enraged legislators at a congressional hearing yesterday where AIG’s former bosses were accused of spending taxpayers’ money on pedicures, golf games and cocktails.

Crippled by losses on financial insurance companies, AIG was bailed out by US taxpayers on September 17 to avert a collapse which risked causing further failures.

The House oversight committee, which is investigating the company’s problems, confronted AIG executives with an invoice from the St Regis resort in Monarch Beach, south of Los Angeles, detailing an eight-day company event which began five days after the rescue.

“Average Americans are suffering economically,” said Henry Waxman, chairman of the committee. “They are losing their jobs, their homes and their health insurance. Yet less than one week after the taxpayers rescued AIG, company executives could be found wining and dining at one of the most exclusive resorts in the nation.”

The bill shows that AIG spent $139,375 on rooms, $147,301 on “banquets”, $23,380 on spa treatments and $6,939 on golf at an eight-day company event which began on September 22.

“US taxpayers will be, in effect, paying for this,” said Elijah Cummings, another Democrat, who demanded to know who was responsible for the outlay. “I think that person ought to be fired.”

Rates for the 325 rooms at the resort are typically upwards of $500 a night and the travel guide Fodor’s gives the place a rave review, saying: “Exclusivity and indulgence carry the day here; you can even have someone unpack for you.”

AIG has defended the event, saying it was to entertain freelance insurance salesmen who sold life, health and accident policies for the group’s US subsidiary.

But former chief executive Robert Willumstad, who stood down as a condition of the government’s bail-out, conceded that the getaway “seems very inappropriate”.

“If I had been aware of it, I would have prevented it from happening,” he added.

Defending their conduct in AIG’s final days, Willumstad and his British-born predecessor, Martin Sullivan, blamed the company’s problems on accounting rules which required it to write off billions of dollars on mortgage-related securities.

Sullivan said these rules had “unintended consequences” in making AIG’s books look worse than they actually were against the backdrop of a “financial tsunami”.

Carolyn Maloney, a Democrat from New York, accused the two executives of blaming accountants for AIG’s difficulties when in fact they had been “wrecking a great company” by gambling on obscure derivatives. “I think you should apologise to the American people for your mismanagement,” she said.

“Looking back at my time as CEO, I don’t believe AIG could have done anything differently,” said Willumstad. “The market seizure was an unprecedented global catastrophe.”

AIG mostra recuperação 2

outubro 8, 2008
A.I.G. Takes Its Session In Hot Seat
By MICHAEL J. de la MERCED and SHARON OTTERMAN
8 October 2008

The New York Times

Late Edition – Final
1

A day after Richard S. Fuld Jr. was compelled to explain the millions of dollars he made at Lehman Brothers, two former executives of the American International Group took their turns in government witness chairs on Tuesday, answering critical questions from lawmakers about business and pay practices and outsize spending that continued even after the company received an $85 billion lifeline from the government.

One particular point of contention during the hearing before the House Oversight and Government Reform Committee was a weeklong retreat that a life insurance subsidiary, AIG General, held for its top sales agents at the St. Regis Resort in Monarch Beach, Calif., only a week after the government extended its $85 billion loan last month.

The $442,000 in expenses for the week included $150,000 for food and $23,000 in spa charges, according to documents obtained by the committee.

Joe Norton, A.I.G.’s director of public relations, said in an interview that the event had been scheduled last year, though he did not know whether executives had considered canceling the retreat after the bailout.

In addition to questions about spending, the two A.I.G. executives who appeared before legislators, Martin J. Sullivan and Robert B. Willumstad, faced sometimes heated inquiries into risky bets by the company on complicated financial products that insured mortgage-backed securities.

A.I.G., for decades the largest insurance company in the world, must now sell wide swaths of its businesses to repay the government loan, made because of the potential catastrophe that the company’s bankruptcy would have unleashed.

Mr. Sullivan was criticized for his reassurances to investors about A.I.G.’s health in December despite warnings from company auditors that its exposure to those contracts was growing.

And many legislators berated the two men for large pay packages dispensed to top executives despite evidence that the company’s financial health had begun deteriorating in 2007. Mr. Sullivan was questioned by several lawmakers over why he had requested that accounting losses from A.I.G.’s exposure to these swaps be excluded from calculating one particular compensation plan.

The two former executives also took criticism from their outspoken predecessor, Maurice R. Greenberg, who sought to deflect responsibility in a statement to the committee. Yet Mr. Greenberg, who also questioned the need for the government’s de facto takeover of the company as part of its rescue package, declined to appear, citing illness.

The nearly five-hour hearing was the second this week held by the House committee after the pointed questioning on Monday of Mr. Fuld about the collapse of Lehman, the investment bank he led. Committee members, led by Henry A. Waxman of California, are seeking more information from troubled financial companies after the passage of the Bush administration’s $700 billion bailout plan last week and the chaos gripping the markets.

”A.I.G. had to be bailed out by taxpayers because of your investments in credit-default swaps,” Carolyn Maloney, Democrat of New York, said. ”I don’t believe any of your management deserves a bonus.”

Mr. Sullivan, who was ousted as A.I.G.’s chief executive in June, and Mr. Willumstad, who was the company’s chairman before succeeding Mr. Sullivan, blamed wider market tremors for the company’s stumbles. They also attributed A.I.G.’s $25 billion in write-downs to mark-to-market accounting rules, which forced the company to take paper losses that led to debilitating credit downgrades.

Yet both Democratic and Republican lawmakers dismissed those arguments, citing testimony from a former chief accountant for the Securities and Exchange Commission.

”A.I.G. is blaming its downfall on accounting rules which require it to disclose losses to its investors,” the witness, Lynn E. Turner, said. ”That’s like blaming the thermometer, folks, for a fever.”

Instead, lawmakers focused on efforts by company management to shield inquiries into the London subsidiary that had underwritten the derivatives contracts that became devalued during the global credit crisis.

Both PricewaterhouseCoopers, the company’s auditor, and an independent accountant complained of a lack of access to the London unit and its leader, Joseph Cassano. The accountant, Joseph St. Denis, said in a statement to the committee that he had been deliberately blocked from questioning Mr. Cassano because he might ”pollute the process.” Mr. St. Denis later resigned in protest.

Mr. Cassano has continued to draw $1 million a month in consulting fees from A.I.G., a fact that aroused ire from several lawmakers. He earned $280 million over the last eight years.

For his part, Mr. Greenberg sought in his written statement to cast A.I.G.’s troubles as arising after he left in 2005, under the shadow of an accounting inquiry.

”When I left A.I.G., the company operated in 130 countries and employed approximately 92,000 people,” Mr. Greenberg said in a statement. ”Today, the company we built up over almost four decades has been virtually destroyed.”

When asked about Mr. Greenberg’s contention that risk controls at A.I.G. had loosened after his departure, Mr. Sullivan argued that risk controls had actually tightened since then.