Shareholders at Risk from Accounting Loopholes

The credibility of corporate financial statements is undermined by a set of disclosure and accounting loopholes relating to impending and potential liabilities. Investors should not trust SEC reports and financial statements until these loopholes are closed by FASB and the SEC. On June 16,2009 the Investor Environmental Health Network (IEHN) issued a new report, Bridging the Credibility Gap: Eight Corporate Liability Accounting Loopholes That Regulators Must Close. The report describes how companies are encouraged, and arguably even required, by current accounting rules to keep hundreds of billions of dollars of impending liabilities off of their financial statements and out of securities filings. While the report examines case studies of asbestos and nanotechnology company disclosures, the findings apply to a wide array of impending and potential liabilities that companies should be disclosing and estimating in their financial statements.

Download the report and read more on my blog at http://tr.im/qF4j