Jeremy Newman Has Had It
So much so that he wrote a letter. The BDO
International Global Coordiation CEO and infrequent blogger sent his letter to the Financial Times today in response to previous letters to the FT that unequivocally placed the blame for the financial apocalypse on accounting rules.
Newman, who strikes as the mild-mannered sort, comes as close to telling all the haters out there, “OH, HELL NO” as one might expect:
Sir, It is unfortunate if people are persuaded that accounting rules are to blame for bad lending decisions and poor investments (Letters, December 29). Banks, and other financial institutions, needed injections of monies from governments (and others) because they lost money and were short of cash – not merely because of accounting issues. Inadequate bad debt provisions, if such was the case, may have resulted in unduly large bonuses being paid but it was not the bonuses that created the cash shortages – it was the poor lending decisions that resulted in such bad debts. Equally, accounting rules did not result in companies overpaying for acquisitions – it was the poor investment decisions that resulted in a decision to overpay.
It’s pretty clear that J. New is sick and tired of everything being blamed on accounting rules and he figured writing a stern (but cordial) letter to the FT was the best way to draw the line in the sand. While that might have some effect, we would invite him to cut loose (read: go completely ape shit) on his blog to tell those IFRS haters what they can do with their pointer fingers. If you want us to read a draft JN, we’re here for you buddy.
Poor business decisions were behind losses [FT]