Launching A New Blog

Thank you, Save the Blue Frog subscribers, for following our Entrepreneurship course during the past month. We appreciate your interest in our progress, and we value your feedback regarding our content.

We’re now pleased to report that we’re launching a new blog for the course. You are welcome to continue subscribing to it, and sharing your thoughts and suggestions with us.

We’ll cease our postings of the course content on this blog at this time. Please let us know if you enjoyed this one month snapshot of our activity.

Most importantly, we appreciate your time and your support. Our course is richer for it!

Launching A New Blog

Thank you, AQPQ subscribers, for following our International Accounting course during the past month. We appreciate your interest in our progress, and we value your feedback regarding our content.

We’re now pleased to report that we’re launching a new blog for the course. You are welcome to continue subscribing to it, and sharing your thoughts and suggestions with us.

We’ll cease our postings of the course content on this blog at this time. Please let us know if you enjoyed this one month snapshot of our activity.

Most importantly, we appreciate your time and your support. Our course is richer for it!

It’s Your Turn, Redux

We’re about to experience an online weekend for the second time in three weeks! And thus, once again, it’s your turn to take a proactive role by applying our content to your own business concept.

Thus, by Thursday, October 4th at 9:00 am, please update your Google Drive project folder. You should address my feedback about your initial submission by updating your prior work, and then add your new flexible budget and storyboard work to your folder.

Later today, on September 25th, I will reach out to each of you via email to schedule a brief ten minute telephone or face-to-face conversation. As we discussed, I prefer to review my feedback with you via a verbal conversation.

Finally, please keep in mind that our Blackboard system will be down for maintenance all weekend. I have established a web site for us to serve as a temporary replacement for Blackboard. Of course, our Save The Blue Frog blog is always available as well.

Assets

Last week’s conversation was pretty interesting, wasn’t it? First, we took an initial glance at the dramatic differences between the GAAP approach and the IFRS approach to quantifying Fair Value.

Then? We took a second glance at those differences. And we couldn’t help but notice that those differences weren’t so dramatic after all! Although the standard setting bodies stake out different positions on a “general principle or rule” basis, they utilize their interpretive guidance to nudge accountants to converge on similar approaches.

That shouldn’t strike you as a stunning surprise. After all, the professional teams at FASB and the IFRS have been discussing the goal of convergence for many years. Their extensive conversations have inevitably moved the standards of the two organizations closer to each other.

What else did we learn last week? For starters, it’s always helpful to compare the American and international standards to glean a balanced perspective. Indeed, we should always read the text of the original standards very carefully, and not merely the professional summaries.

It’s also useful to review the interpretive guidance that is promulgated by the standard setting bodies. Finally, we can glean insights into the standards by applying our knowledge to recent sets of financial statements.

So where do we go from here? Next week, we’ll take a Grand Tour of the major balance sheet assets. Our textbook reviews this content in Chapter 4.

How shall we meet this challenge? After taking a brief quiz on the content that we discussed last week, we’ll review the textbook material for Chapter 4. Then, as an illustrative example, we’ll focus on a discussion of Goodwill, and we’ll utilize the most recent annual financial statements of Anadarko to apply our knowledge to a contemporary firm.

And how should you prepare for class? Please skim the entire chapter, and then read the section on Goodwill in detail. Afterwards, please review the relevant IFRS and FASB standards (and relevant interpretive guidance) that affect Goodwill. Finally, please review the Anadarko statements, and ask yourself how an investor would perceive Anadarko if it had utilized IFRS instead of GAAP.

Finally, please keep in mind that the fundamental purpose of the financial statements is to assist users who are endeavoring to estimate the value of the entity. Does GAAP accounting for Goodwill optimally help the user do so? Or does IFRS accounting?

We will continue to explore these themes throughout our course. By the time we conclude the semester, we’ll possess an extremely thorough “grounding” in the principle of enterprise value, and in the methods that are promulgated by GAAP and the IFRS to support this essential principle.

If you have any questions about this content as you navigate through it, please let me know. And by the way, if you have not yet sent me your Gmail address so that I can invite you to access your term project folder … now would be a very good time to do so!

It’s Your Turn!

Reminder: Click here for the course materials.

As you know, this weekend is an online weekend. You are working on your first term project submission, and will upload it to your Google Drive folder by Thursday, September 20th at 9:00 am.

And what do we plan for our next classroom meeting? We’ll begin with our customary brief quiz on the traditional balanced scorecard and statistical analysis. Then we’ll discuss our first submission activity, and I’ll ask a few of you to present your content to your classmates.

Finally, we’ll review the remaining course materials that are related to The Business Model. And we’ll preview the next section of the course, i.e. the section that addresses Volume Estimation.

While we complete these activities, please keep in mind that we are using the Integrated Reporting Framework to organize our content for the Term Project. It’s never too early to begin organizing your thoughts about the final presentation!

IFRS vs. GAAP: Fair Value Measurements

Reminder: Click here for the course materials.

Did you enjoy Hybrid Class Week? It was certainly a change of pace, wasn’t it?

This week, we have a few more “firsts” to experience together. Let’s proceed through our plans, step by step:

1. Prior to our class session on Tuesday, please send me your Gmail address. I’ll respond by sending you an Invitation to a Google Drive folder; you’ll use it to upload your Term Project materials.

2. During the first ten minutes of our session, we’ll take our first quiz together. It will cover the essential principles of the IFRS and GAAP standards regarding fair value.

3. We’ll then spend the bulk of the remaining session on a discussion of your “jotted thoughts” from Hybrid Class Week. The learning goal will be to understand why an organization might prefer one set of standards over the other, and how industry-specific risks impact this preference.

As we advance into mid-September, we’ll plan to pick up the pace a bit! But please don’t worry; now that we’ve gotten to know each other, the semester should be fairly manageable.

Applying The Business Model

Reminder: Click here for the course materials.

And now it’s your turn! We discussed the balanced scorecard and statistical analysis in depth yesterday. You are now empowered to apply it to your entrepreneurial business concept.

As you know, we do not meet in person next week. So let’s discuss our online plans for the next two weeks:

1. Please open a free Gmail account. If you already have one and do not wish to use it for our upcoming online discussion, you are welcome to open a second account.

2. No later than Friday, September 14th, please send me your Gmail address. I will respond with an invitation to access a folder that you will use to organize your project. As we discussed in class, if you strongly prefer a different document management system, please let me know.

3. Using the traditional balanced scorecard framework (while feeling free to modify the framework if necessary), please develop a conceptual model in the manner that we discussed in class. One or two sentences for each component would be helpful. Some sense of causality (i.e. cause and effect) between the components would also be helpful.

4. Using the statistical survey question format that we discussed in class, please develop a set of X and Y questions that can demonstrate the validity – and thus the potential value – of your entrepreneurial concept. You do not need to collect data yet; solely focus on the questions for this week’s activity.

5. Review the components of the Integrated Reporting “Octopus” framework. Make brief notations to identify the components that will be defined by your balanced scorecard and statistical survey work.

6. A strict interpretation of the guidelines of our program would necessitate your submission of this work by Saturday, September 15th at 9:00 am. However, as long as I receive your Gmail address by that time, you are welcome to upload your work to your folder by Thursday, September 20th at 9:00 am.

If you have any questions, please let me know! I look forward to watching your project take shape in your folder.

Hybrid Class Week

Reminder: Click here for the course materials.

Please note that we are NOT meeting in the classroom on Tuesday this week. Instead, we are engaging in an online activity.

Hello again, International Accounting students! I hope you’re enjoying the weekend.

First and foremost, I apologize for the (relatively) late posting of this weekly announcement. As you know, we are about to initiate our first online session. I delayed the posting of this announcement until I was certain about our plans, and now I can communicate them to you.

Last week, we reviewed the financial statements of Anadarko Petroleum Corporation. We discussed how their financial statement presentation format significantly impacts the analytical perception of shareholder value. Then we discussed the IFRS approach to valuing fixed assets, i.e. the largest asset class of most industrial manufacturing organizations.

We also touched upon the existence of FASB Statement 157. It establishes a hierarchy of three “Levels” of assets and liabilities for fair value accounting purposes. However, we did not delve into the details of Statement 157, and we did not compare the American definition fair value to the International definition. Furthermore, we did not discuss how the differences between the two standards would impact a firm like Anadarko.

These are the questions that will enrich our online activity. Here are our plans regarding this activity:

1. On Tuesday, we will NOT meet in the classroom. Instead, we will re-allocate those 150 minutes of classroom activity to online learning activities over the remainder of the semester.

2. So what must you do this week? First, please open a free Gmail account. If you already have one and do not wish to use it for our upcoming online discussion, you are welcome to open a second account.

3. Then use your free IFRS account to download and review the IFRS Standard regarding fair value. We identified the online location of this standard in the classroom last week.

4. Then obtain a copy of FASB Statement 157. Our HBU library has a data base that permits you to download a free copy of this standard. If you need instructions about accessing the data base, please access our course materials and review the document entitled HBU Library Instructions.

5. Skim the IFRS and FASB Statements to obtain a very “high level” understanding of their similarities and differences. Then jot down your thoughts to these two questions:

(a) Is it possible that the Chief Financial Officer of Anadarko might prefer one Statement over the other Statement?

(b) To what extent do the Statements require fair value estimates to be modified in order to address risks like catastrophic oil spills?

Because this is very dense material, I do not expect you to hand in your “jotted thoughts”this week. In fact, you might find the content to be slow reading, and you might experience a little difficulty getting through it.

If this occurs, please don’t worry! Simply dedicate an hour to obtaining the information, skimming the Standards, and then jotting down your thoughts. And please prepare to bring your jottings to the classroom on Tuesday, September 18th, when we will continue our conversation.

Good luck! If you have any difficulty with this assignment, please let me know.

Accounting Diversity and Convergence

Happy Labor Day, International Accounting Students! I hope you’re enjoying the unofficial conclusion of the summer vacation season.

It was a pleasure to meet all of you last week. Here are some notes to guide our way, as we venture into the semester together.

Last week, we engaged in an introductory discussion about international accounting (i.e. Chapter 1), and segued into the emerging field of international corporate social reporting (i.e. Chapter 15). For the next two weeks, we’ll extend this conversation by addressing issues of worldwide accounting diversity (i.e. Chapter 2) and the international convergence of financial reporting standards (i.e. Chapter 3).

So how, exactly, will we do that? Let’s proceed a step at a time:

1. The Teaching Strategies section of our syllabus states that “Some days are hybrid days. On these days, students will complete online assignments outside of our assigned classroom.” Although our September 4th session will be a normal classroom meeting, our September 11th session will be an online meeting. Please do NOT travel to our classroom on September 11th!

2. For our online meeting, we will discuss the impact of international reporting standards on corporate strategy, operations, and financial valuation by addressing fixed asset accounting in the energy industry. To prepare for this online discussion, please open a free basic account with the IFRS Foundation.

In addition, please ensure that you can access the annual financial reports of Anadarko Petroleum Corporation. This American organization utilizes U.S. Generally Accepted Accounting Principles (GAAP) for its financial reporting standards; we will discuss how a hypothetical shift to international reporting standards would affect it.

3. Given our “classroom without walls” teaching strategy, I will begin to post selected course notes and materials on (both) the University’s internal Blackboard system and an external social media resource. This will enable colleagues from the academic and practitioner communities to contribute their perspectives to our discussion.

4. Finally, I have an administrative requirement to share with you. Although I’ve decided that it is premature to begin giving quizzes this early in the semester (we’ll wait a couple of weeks to do so), I do need to obtain electronic “signatures” from you regarding our syllabus. Please bring an internet equipped electronic device to class this week.

As you can see, our lives are about to become more interesting! But please don’t worry; we’re embarking on this journey together.

Click here for the course materials.

The Business Model

Happy Labor Day, Entrepreneurship Students! I hope you’re enjoying the unofficial conclusion of the summer vacation season.

It was a pleasure to meet all of you yesterday. Here are some notes to guide our way, as we venture into the semester together.

Last week, we engaged in an introductory discussion about the classic model of accounting and valuation, as codified by Friar Luca Pacioli over five centuries ago. We then time-traveled to our contemporary era and reviewed the Integrated Reporting framework.

Meanwhile, in other courses of our program, you began to identify and explore your own entrepreneurial opportunity. It’s time to integrate our coursework by analyzing that opportunity from a financial perspective.

So how, exactly, will we do that? Let’s proceed a step at a time:

1. We can find the Integrated Reporting framework on page 13 of the guidance document that was published by the International Integrated Reporting Council. A link to the document is included in our course material page entitled Course Information; we’ll begin our session on September 8th with a brief closed-book quiz about the framework.

2. As a homework assignment in advance of September 8th, please begin to apply the Framework to your entrepreneurial opportunity. You are welcome to use any electronic or physical resource to help you do so; during our September 8th session, we will ask you to verbally describe the element(s) of the framework that (in your preliminary opinion) will be most difficult to define within your plan.

Is it too soon to engage in this activity? Perhaps it is! But please give it a shot, and be prepared to share your experience with your classmates.

3. As you may recall, on our course material page entitled Course Information, I included a link entitled Course Slides (Current Edition). Please click on that link and review the slides entitled Course Agenda, The Need for a Managerial Accounting Approach, and A Five Step Planning Process. Then proceed to review the quartet of slides entitled Step 1 – The Business Model.

I actually do NOT expect you to understand most of this content! After all, we have not yet reviewed it in class. Nevertheless, it can’t hurt to flip through those few slides before we review them together.

4. I have prepared another course material page entitled The Business Model. Please click on the six links on that page and lightly skim the content, understanding (once again) that I do not expect you to understand most of the content.

5. As we discussed in class yesterday, given our “classroom without walls” teaching strategy, I will begin to post selected course notes and materials on (both) the University’s internal Blackboard system and an external social media resource. This will enable colleagues from the academic and practitioner communities to contribute their perspectives to our discussion.

6. Finally, I have an administrative requirement to share with you; I need to obtain electronic “signatures” from you regarding our syllabus. Thus, please bring an internet equipped electronic device to class this week.

As you can see, our lives are about to become more interesting! But please don’t worry; we’re embarking on this journey together.  🙂

Click here for the course materials.