Accounting standards, transparency and religion are our topics this week.
Perhaps you’ve heard the phrase ‘mark-to-market’. This is the idea that companies should declare the value of assets according to what they would fetch in the open market right now.
In some ways it seems contrary to common sense. For instance, if I want to sell my house but I can’t immediately find a buyer, I don’t automatically assume that my house is worth nothing … I reason that it’s a slow season, or the price needs to come down a bit.
However ‘mark-to-market’ is a widely accepted accounting rule and this week we’ll explain why it’s been at the heart of the current credit crisis.
We’ll also be talking about transparency in business – and the advantages and disadvantages of keeping secrets.
All that and religion too. In recent weeks even church leaders have waded into the controversy over short selling. We’ll be considering whether morals influence business decisions. Is it becoming difficult to separate the assets to be rendered onto Caesar from those payable directly to God?