PLI: FASB's Codification has been in effect for several months now; how
do you think it will affect filings by U.S. public companies?
MICHAEL HERMSEN: On June 30, 2009, the Financial Accounting Standards Board (the "FASB") adopted Statement of Financial Accounting Standards No. 168, The FASB Accounting Standards CodificationTM and the Hierarchy of Generally Accepted Accounting Principles — a replacement of FASB Statement No. 162 (the "FASB Codification"). In short, the purpose of the FASB Codification was to reorganize all existing U.S. accounting and reporting standards issued by the FASB and other related private-sector standard setters into one authoritative body of literature, which will ease research of accounting literature and reduce the risk of noncompliance. (Additional benefits of the FASB Codification are that it will assist with international convergence of accounting standards and it will serve as the authoritative reference source for the new XBRL requirements.) Going forward, all revisions will be made in real time to the FASB Codification. The FASB Codification became effective for all financial statements issued for interim and annual periods ending after September 15, 2009 (the "Effective Date").
Online marketplace for lending and borrowing, accomplished outside the established financial system.
Bank of America Tower.
Seriously, stand in the Lower East Side and that thing looks like it's
just going to tip over. Unlike the original leaner in Pisa, B of A
Tower angles like that to catch more natural light. It is, after all, a
truly green building — made up of all kinds of recycled materials, with
a greywater system (that means it uses rain water) — having been LEED
certified "platinum." (Has a great beat and you can dance to it?)
Though not expert in these things, Toolbox imagines leases in B of A
Tower are pre-greened. Of course, not all of your clients are so lucky
in terms of whether they can rent in a green building or to be leasing
one — some of them might even rent or own an old-line, soot-colored
building. For them, going green is a matter of negotiation and creative
that we're in a holding pattern waiting for Super Bowl XLIV (and
they're going to have to think about swapping out of the Roman Numerals
soon or risk people staring at the numbers the entire game trying to
decipher them — Super Bowl MCMXXLVIII will be a doozy), Toolbox can't
get its mind off chips and dips. Be it salsa, spinach or bean, dip
costs, so Toolbox tends to go around the room before the game to drum
up some cash assistance — kind of a homespun dip financing. Of course,
there's always at least one clever lawyer who wants security for his
investment, like a guarantee that he'll get "x" number of chips for his
dip money. Strangely enough, that's not that far off from what the DIP
financing companies (otherwise known as debtors in possession — that's
the DIP) in Chapter 11 bankruptcy proceedings have to procure in order
to stay in business pending the outcome of their petition. DIPs are a
fairly recent development, having come into existence along with the
1978 Bankruptcy Reform Act, and are essentially a lender’s bet (with a
built-in return if they're right) that a company will emerge from
bankruptcy in relative working condition.
We talk about compliance in this newsletter primarily as it pertains to lawyerly advice. But the truth is that effective compliance programs are actually aimed at rank and file employees of corporations — do this, don't do that, do keep records, don't harass, etc. It's easy to stand on high and tell clients, "This is how it's done." On the ground, things are not that simple. A great compliance program is useless without buy-in from everyone at a company. That means from CEO on down, the culture must be clear, and everyone must know the plan. Practically speaking, however, the plan is implemented further down the food chain than management and lawyers coming up with organization-appropriate compliance plans. For the average employer, the "marching orders," for lack of a better term, will come from their direct managers and human resources. So what's a lawyer to do to get the people at the top and the people on the ground working together on the same level?
PLI: How have regulators and prosecutors approached increased investigations in the wake of the financial crisis?
ANDREW J. LEVANDER: In the not too distant past, it was the case that when a regulator or prosecutor held a press conference, it was to announce that an indictment had been filed against an individual (or entity), a civil enforcement action had been filed, or a settlement or plea bargain had been reached. More recently, however, law enforcement authorities have adopted the practice of publicly announcing that they are undertaking an investigation of an entire industry or practice. Regulators announce these broad investigations with much fanfare and they receive significant press attention. The pressure on regulators to show results from such efforts is significant. Prominent examples of these public announcements are described below.
PLI: How did federal regulators react to charges that, in part, short
selling drove the financial collapse toward the end of 2008?
AUDREY STRAUSS: Naked short selling and false rumors are frequently cited as having caused or hastened the collapse of several major financial institutions in 2008.
Coalition for New Credit Models: Trade association made up of for-profit, non-profit, and social enterprises "using new technologies, products and business models to provide credit and information" to consumers and "small and mid-market businesses."
At first, Toolbox was not impressed, but after a few episodes, Glee
gets the "best, new network television show in years" award. While
putatively about a glee club (and there's a lot of singing packed into
the weekly hour), it's basically a nighttime soap, full of life issues
— one of which is "pregnant teen to give up child for adoption" issue.
And they do it in fine, comic/soap style. Of course, everyday-folks
(like your clients) involved in the adoption process don't get the
option of Hollywood writers to make things go smoothly. While the
process often ends up in glee, the path can be so arduous and
frustrating, with legal roadblocks galore, that prospective adoptive
parents may just want to flee.
a boy, Toolbox's (maybe everybody's) first e-discovery was sticking its
finger into an outlet. Toolbox's second e-discovery was as a teen, when
it brought its e-razor, without an adaptor, to France. You live, you
learn, you grow a beard. The second lesson is actually a problem for
legal e-discovery, at least insofar as the need for adaption when it
comes to litigation and the rules being promulgated worldwide to deal
with the now ubiquitous EIS (electronically stored information) and
privacy. So what happens when you have employees in Europe who are
protected by EU privacy laws and a process requiring adherence to
e-discovery in the U.S.? Zap is right--try sticking a finger in that