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pabraifan

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Posts posted by pabraifan

    What are they thinking?

    in General Discussion

    Posted

    If this is so harmful, want to tell me who was exactly harmed by Rajaratnam trading on info that Goldman was about to get an investment from Buffett? Then once you've identified the victimized party, explain to me how that deserves ten years in prison.

     

    Well, when you make rules that everybody's supposed to play by and someone doesn't, it harms all the others who were supposed to be playing the game with the same information as everybody else but actually weren't. So everybody who could have benefited from knowing that Buffett was about to invest but didn't was harmed (most directly those on the other side of the trades, but also everybody else who with that information would have traded differently). That's a lot of people. But that's just the first degree; once you have enough of that stuff, it erodes confidence in the whole game and makes the whole system stop working, so that's a lot more damage, even if more indirect and diffuse.

     

    I agree with Liberty.

    If a precedence is set, then the system will stop working and give people incentive to rub elbows with politicians, not play by the rule and do some charity to cover their butt if caught.

    What are they thinking?

    in General Discussion

    Posted

    Too harsh? A law is punishable by the act and not your other deeds in life. If his wealth that he gave away was attained by doing unethical things, why should he be rewarded for that?

     

    Totally agree.

    If the judge shows leniency for people committing insider trading law, where will the line be drawn ? Fraudsters as Ken Lay will also ask for leniency too with the same reasons. It's a slippery slope. Without harse sentencing, people will do whatever they want in the stock market and the small investors will be taken advantaged of. A good example is Japan where people don't respect insider trading law.

    Should operating leases be presented as liabilities on balance sheets?

    in General Discussion

    Posted

    Question: Will the right to use asset always match up one for one with the operating lease liability? 

     

    Like, say, you have long term real estate leases where you are paying below market rent, and then you sublease the real estate, earning a spread.  Do you capitalize the right to use asset such that the asset is greater than the liability?

     

    Sure. If you're paying below market rents and locked up for such a low rate for the future, then you should be able capitalize the between greater assets and liability. Whether asset will match with liability is a question for the accountants. It is better to reflect reality someway than leaving it out from the balance sheet and in the disclosure.

     

    Back to the original question:Yes, operating leases should be capitalized as assets an liabilities on the balance sheet as finance leases. The only difference bw finance and operating leases is ownership, but both are contractually liable. Capitalizing operating leases will allow investors to have a better picture about the company;s  D/E ratio.Hiding operating leases in disclosures is definitely not the solution.

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