CFO.com's Sarah Johnson reported on the SEC's first roundtable held last week to explore the possibility of giving US companies the option of switching to International Financial Reporting Standards.

The thinking of the multinationals at the table? It was done in Europe in three years; it could be done here in three years. That's a "can-do" kind of spirit not often seen when it comes to financial reporting requirements. It's usually "can't do:" can't apply 157 in time, can't be ready for Section 404 audits, can't change computer systems to accommodate - (insert your favorite standard number here).

There's more benefit to firms in making a switch from US GAAP to IFRS than accrues to them from other reporting-type changes, so the can-do spirit is explainable. They might already be reporting chunks of their operations in IFRS and it would naturally be easier to get the whole thing on one footing.

They also might perceive IFRS as being more simple to apply because it contains less details to which they must conform - for now, at least. That may change as more companies road-test those standards.

Is it the straight-line path that many observers think it will be? Of course not. There are plenty of obstacles: the US reporting system is probably richer and more complex that the ones IFRS replaced in Europe, and adapting IFRS to that will be more difficult. There is a bank-regulation system that's based on US GAAP and auditing standards based on GAAP as well. And for years, there's been hand-wringing over a shortage of trained accountants; that's "trained" as in trained in US GAAP. There are even fewer accountants in the US experienced in IFRS.

The SEC seems hell-bent on making the choice happen. It's going to be quite a ride.

I spent Monday through Wednesday attending the largest conference devoted to current events affecting financial reporting, featuring plenty of the SEC's staff - the ones who interact with the auditors examining the year end financials. And I'm wondering: when did the SEC become afraid of its own shadow? There seemed to be an overwhelming aura surrounding the SEC presenters, a kind of self-consciousness that they be careful to not "write GAAP" in the delivery of their speeches to the audience.

When this conference first began thirty-five years ago, the intent was to bring the SEC's thinkers and doers in front of a large audience of auditors, to discuss the problems they'd seen in filings with the audience. The intent was not to "speechify GAAP" - but to get the message out as to the problems they'd seen and describe how they handled it. The goal: to identify troublesome practice issues and tamp them down before they became pervasive by presenting them to the auditors who could do something about it. That's a worthwhile service to everyone involved in the financial reporting chain, from preparers down to users and the auditors in between.

That's not writing GAAP - that's being an effective regulator. (And don't forget that writing GAAP is something that the SEC is empowered to do.) Preventing problems through effective communication has always been at the heart of this conference. And this effective communication worked quite well long before the advent of Blackberries and the internet -  accounting firms responsible for keeping their SEC knowledge current seemed to get the message quite well by the state-of-the-art information distribution means, like overnight delivery and fax machines.

Now that there's virtually instant transmission of data, including the publication of all the speeches on the SEC's website at no charge to readers, critics are complaining about the dissemination of the comments in the speeches as being unfair. Absurd.

The comments of the SEC commentators were full of reminders of current GAAP, but missed the pithiness of years past when they described fact patterns that showed how a standard was misinterpreted or misapplied, and how they expected it to be remedied if encountered in practice by members of the audience. Instead, many of the commentators offered comprehensive reminders of where trouble might occur in the application of new accounting standards, rather than reporting on the known snafus they'd seen. Instead of warning registrants and auditors about problems they'd seen, it'slike they're wish-listing problems they hope don't happen. While there's value in that approach, there might be a lot more value in what they'd done in the past. Shouldn't regulators act like regulators, instead of acting like their walking on eggshells?

EITF meeting today - not much time to write, but a couple of things for you to consider that you might not have noticed.

First, an excellent description of the above-named securities in a speech by Erik Sirri , the SEC's director of the Division of Trading and Markets. Erik explains the "concentration-despite-diversification" present in these creations, how they dissolved, and makes a couple of not so bold predictions, which are probably dead right. Like this one:

"I'm enough of a historian to know that, some number of years down the road, we or our successors likely will again be commenting on why some other product or business led to large and unexpected losses. But it will probably not be super senior ABS CDO."

Anyway, it's a good read, with more technical description of what goes on in making these things - and their markets - than you'll read in the mainstream financial press.

And there's also a very British view of the way these things work, courtesy of YouTube.

Yes, we've already had Black Friday, and today is Cyber Monday. No doubt you'll be on the receiving end of gift cards purchased sometime in the holiday shopping season, and you'll probably give a few of them, too.

There's an accounting angle to those gift cards: they're not sales for the retailers or restaurants that issue them until they're redeemed. Until the ultimate customer purchases something with them, they're just deferred revenues sitting on the right-hand side of the balance sheet. And if they never get redeemed by the giftees, they simply sit there: a lump of liability, coal in the stocking of the balance sheet.

That non-redemption can be very common. (How many of those cards do you have sitting in a desk drawer from last Christmas?)

The liabilities can be removed via journal entry, courtesy of the concept of "breakage" - meaning that the liabilities get de-recognized when management determines that a portion of the gift cards will never be cashed in. The SEC weighed in on this a few years ago when it issued SAB 101 , which ultimately became SAB 104 . Bottom line: it's not improper to de-recognize, as long as it's supportable. And from the investor point of view, the timing of any de-recognition would be noteworthy: any clean-up of the liabilities in a weak quarter might be suspicious, perhaps motivated by a desire to meet estimates.

There's no particularly noteworthy case of a company using gift card breakage to manage earnings. Maybe it's been done, but the disclosures might not be sufficient to leave a bread crumb trail. CFO.com has a good story on the concerns surrounding gift card accounting, and the Journal of Accountancy has an interesting article and study on their prevalence by Charles Owen Kile Jr., an accounting professor at Middle Tennessee State University.

Apparently gift cards aren't the only thing that recipients forget about. Here's a link to a story about something probably more valuable that people forget about as well: income tax refunds. That one is more amazing: if you bothered to send in a tax return, wouldn't you be looking forward to getting some cash back? Apparently not: the IRS says there's $110 million in unclaimed refunds outstanding.

Yesterday, the FASB voted to propose a deferral of Statement 157 - not the full Monty, but a portion of it.

The part of Statement 157 that applies to financial instruments - the spaghetti hitting the fan these days - will not be deferred. So come next year, investors will still be able to pore over filings, trying to gauge their tolerance of Level 3 valuations of collateralized debt obligations and the like.

The part of Statement 157 that will be deferred for one year - presuming the proposed staff position will be favored by constituents (a process not unlike asking a bear if it likes meat) - is its application to all nonfinancial assets and nonfinancial liabilities, except for those items that are recognized or disclosed at fair value in the financial statements on a recurring basis. Some examples: non-financial assets and non-financial liabilities that are measured at fair value in a business combination; indefinite-lived intangible assets; asset groups in impairment tests; and asset retirement obligations initially measured at fair value.

No deferral on derivatives – financial and nonfinancial ; servicing assets and liabilities measured at fair value on a recurring basis under Statement 156; loans; and debt. So investors can relax a little bit - the scary stuff of the moment will still be uncovered by Statement 157. (Hopefully.)

One has to wonder what the deferral really accomplishes: the items on which 157's applicability is deferred are mainly the things of acquisitions and impairments. The (eternally) forthcoming standard on business combinations, Statement 141R, is expected to address these issues, and sounds as if it won't be effective until 2009 - just like this deferral.

Is this just your regular double-strength, double-secret deferral? Or is the arrival date of 141R even later once again? Or is it good public relations so that the FASB appears to be receptive to the requests of preparers who have coughed up concerns about Statement 157 late in the game? Maybe all three. Insufficient data to evaluate, for now.

One note: in the FASB's handout materials for the meeting, they mention that "Preparers that advocate a deferral note that the early adopters had been following the deliberations of the Statement more thoroughly and extensively than those that did not early adopt. They also observe that the early adopters are primarily large financial institutions that have significantly more experience and dedicated resources in valuing financial instruments (as well as nonfinancial instruments).

Not so fast. In connection with an upcoming piece on fair value reporting, we've tracked down 88 publicly-traded firms that adopted Statement 157. They were definitely not "primarily large financial institutions that have significantly more experience and dedicated resources in valuing financial instruments." (Although they were mostly financial institutions.) Of the 88 firms, 56 of them - over 60% - had a market capitalization of less than a billion dollars. The median market cap: under $300 million. Check the chart at left: of the ones we found, the vast majority were in the lowest market-cap decile. (Deciles measured in billions.) So let's not assume that all of the 157 early adopters are the now-stumbling financial giants; there were quite a few tiny community banks in the group. 

 Statement 157 is often blamed for asset writedowns in the colossal financials, amid whining about "Level 3" valuations - as if they're something new. Statement 157 didn't cause