I wrote:
> Inventory valuation is as complex as depreciation.
Christopher Browne writes:
> I don't think it's *quite* as complex.
Have you dealt with work-in-process? Valuation of stocks of discontinued
products? Livestock? Perishable goods?
> All of the above was not exactly what you'd think of as "having multiple
> sets of books" (even though that is *exactly* the terminology in use); it
> is more like having multiple views on the same data.
The practice I was referring to is the formerly common one of using
different "books" for the IRS and the annual report. All expenses and
income were recorded in both and nothing was concealed, but one might, for
example, use the depreciation schedules with the most favorable tax
consequences in the one while using those that make the most financial
sense in the other. The idea was to minimize taxes while providing
accurate (or, according to the cynics, optimistic) information to the
shareholders. This often resulted in more profit being reported to the
shareholders than to the IRS. The politicians didn't like that.
--
John Hasler
[EMAIL PROTECTED] (John Hasler)
Dancing Horse Hill
Elmwood, WI
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