Memo 1
Memo 1: eVade Pays Up
1. present obligation defer of liability
2. state law, so not a contingency
3. legal liability
On March 31, 2012
Doing nothing: reason: yes there is a new tax rule of amnesty program, but it’s contingent on voluntarily resgister on prospective basis. If they didn’t file the paper work, they still may subject to $60 million. No legal reduction on the liability yet.
Code: gain contingency, derecognition of liability extinguish405-40-1
On June 15, 2012
Memo 2:
Talking about 37 million dollars
It’s not an operating lease.
Session 8: In-Class Discussion Case #2 - Bear Minimum
Provision 3:
25-4 This guidance addresses what constitutes minimum lease payments under the minimum-lease-payments criterion in paragraph 840-10-25-1(d) from the perspective of the lessee and the lessor. Lease payments that depend on a factor directly related to the future use of the leased property, such as machine hours of use or sales volume during the lease term, are contingent rentals and, accordingly, are excluded from minimum lease payments in their entirety. (Example 6 [see paragraph 840-10-55-38] illustrates this guidance.) However, lease payments that depend on an existing index or rate, such as the consumer price index or the prime interest rate, shall be included in minimum lease payments based on the index or rate existing at lease inception; any increases or decreases in lease payments that result from subsequent changes in the index or rate are contingent rentals and thus affect the determination of income as accruable. (Example 7 [see paragraph 840-10-55-39] illustrates this guidance.)
ASC FASB: 1. Earned 2. Received 3. Realizable
SEC: The staff believes that revenue generally is realized or realizable and earned when all of the following criteria are met:
1) Persuasive evidence of an arrangement exists, (in another words : a contract, gives you the right to collect—realizable; obligation –earned)
2) Delivery has occurred or services
1. present obligation defer of liability
2. state law, so not a contingency
3. legal liability
On March 31, 2012
Doing nothing: reason: yes there is a new tax rule of amnesty program, but it’s contingent on voluntarily resgister on prospective basis. If they didn’t file the paper work, they still may subject to $60 million. No legal reduction on the liability yet.
Code: gain contingency, derecognition of liability extinguish405-40-1
On June 15, 2012
Memo 2:
Talking about 37 million dollars
It’s not an operating lease.
Session 8: In-Class Discussion Case #2 - Bear Minimum
Provision 3:
25-4 This guidance addresses what constitutes minimum lease payments under the minimum-lease-payments criterion in paragraph 840-10-25-1(d) from the perspective of the lessee and the lessor. Lease payments that depend on a factor directly related to the future use of the leased property, such as machine hours of use or sales volume during the lease term, are contingent rentals and, accordingly, are excluded from minimum lease payments in their entirety. (Example 6 [see paragraph 840-10-55-38] illustrates this guidance.) However, lease payments that depend on an existing index or rate, such as the consumer price index or the prime interest rate, shall be included in minimum lease payments based on the index or rate existing at lease inception; any increases or decreases in lease payments that result from subsequent changes in the index or rate are contingent rentals and thus affect the determination of income as accruable. (Example 7 [see paragraph 840-10-55-39] illustrates this guidance.)
ASC FASB: 1. Earned 2. Received 3. Realizable
SEC: The staff believes that revenue generally is realized or realizable and earned when all of the following criteria are met:
1) Persuasive evidence of an arrangement exists, (in another words : a contract, gives you the right to collect—realizable; obligation –earned)
2) Delivery has occurred or services