Subject: File No. 4-608
From: Joseph Jefferis, CPA (inactive)
Affiliation: Compliance Accountant

August 24, 2010

Thank you for giving the general public the opportunity to influence the upcoming decisions of this formidable body.

In 2006 the Financial Accounting Standards Board (FASB) allowed mark-to-market (MTM) accounting techniques to impact the financial statements. This dramatic reversal of decades of reporting at the more conservative approach of reporting values at lower of cost or market was a step toward convergence with International Financial Reporting Standards (IFRS). In just two short years the global financial system collapsed. Trust in MTM values disappeared practically overnight. MTM values represent pure "what if" or "as if" fantasies with no underlying economic activity.

MTM breeds good buyers, but fails to require selling your wares at a profit. Had MTM not been mandated by FASB, it is plausible that a financial crisis could have been avoided. Please review the FASB letters from 2005-2006 which opposed MTM. You will learn that a global financial collapse was accurately forecast.

It is my hope and desire that the International Accounting Standards Boards (IASB) review the role of MTM in the global financial crisis. IASB should consider modifying their standard given what we have learned about the financial devastation promulgated by MTM. The goal of a single standard is admirable, but clearly not grounded in financial stability. Financial stability requires profits for sustainability, not a mob mentality or a mere consensus by "global deciders" of economic value.

The headline today is about the big four audit fees falling. Lower audit fees will translate into higher profits for businesses. Implementing IFRS will increase audit fees and thus lower profits and prosperity. Profits and prosperity represent the desired outcome.

It is obvious to the casual observer that the global audit firms stand to reap billions in new revenue if IFRS is mandated. The campaign in favor of IFRS is funded by the global accounting firms. These transnational accounting firms may not have the best interest of ordinary USA investors in their hearts.

Where are the Courts and the Justice systems for enforcement of IFRS? Where will a would-be whistleblower turn if they are harassed or discriminated against under IFRS? Without a single global government, it is difficult to imagine less corruption accompanying IFRS because IFRS currently has no ability to protect those who witness corruption. None.

Please work to get the proponents of IFRS to demonstrate flexibility and compromise. Without flexibility and compromise, then the entire IFRS single standard exercise is a waste of your time and taxpayer's money.

We do not have transnational laws, courts, or police officers. We cannot simply rely on the transnational accounting firms. Their objectivity is clouded by their need for higher fees. Pretending we can have a single transnational accounting standard ignores geo-political risk and other obvious corrupting influences.

Transnational accounting firms are hardly held accountable for their audit decisions today. Implementing IFRS will make them less accountable tomorrow. You are encouraged to review the information about the current crisis in public accounting accountability at:

States are currently responsible for issuing Certified Public Accountant licenses. Jumping to IFRS will eliminate the vital, yet diminishing, role of state oversight of the public trust. If states are not going to hold corrupt CPAs accountable, who can? The Public Accounting Oversight Board is currently frustrated by the non-cooperation of global accounting firms with regard to oil company Royal Dutch Shell, among other global concerns. This will not improve for the PCAOB if IFRS is mandated. Cooperation with the PCAOB will get worse, not better.

US GAAP is the best accounting methodology if we want free enterprise capitalism is to survive the man created disaster we refer to as the financial crisis of 2008. IFRS is bad for free enterprise capitalism.

Some one please educate Sir Tweedie and the other IASB transnational financial elite about the specific role of MTM in the financial crisis.

Please consider the academic work of the James Baker Institute for Public Policy - Who Is In The Oil Futures Market and How Has It Changed? (

You should also review this Pickens Plan Forum posting from just prior to the collapse of oil prices in July 2008. It would appear that MTM forces of oil commodity prices may have been impacted by the "insider" or invisible-to-the-public alternative fuel patent information.

We did not have a financial crisis in the USA until the MTM collapse of oil commodity prices. Oil prices did not collapse until ager the forum posting. MTM was a contributing factor and post financial crisis rules should be adjusted accordingly. Lower of cost or market is appropriate for financial statement presentation.

Restore US GAAP and start healing the global economies. Businesses must once again be forced to have the skills necessary to realize profits, not just temporary mob created paper gains with colluding accountants.

Lower of cost or market is more verifiable and auditable than transnational mark-to-market fantasies.


Joe Jefferis
Dayton, OH