西方会计英语Unit eight Acquisition accounting

[00:03.66]Text 8.2        Honeymoon¹ accounting² offers financial advantag
[00:09.74]The launch last week of TI Group's hostile bid for Dowty, the aerospace³ company ,raised familiar questions about how Mr Christopher Lewinto
[00:18.26]the TI chairman accounts for acquisitions in his rapidly growing engineering grou
[00:23.69]Although wihin accounting standards, TI's past treatment of acquisitions is almost certain to figure prominently in Dowty's defence this mont
[00:31.76]The ensuring debate will again highlight current accounting rules which grant acquiring companies a financial honeymoon during which to reorganise their priz
[00:40.54]a luxury not available to the same degree to incumbent⁴ management
[00:44.59]Ironically Mr Michael Garner⁵, TI's finance director ,is a member of the Accounting Standards Board which later this year will produce a draft standard covering the treatment of fair value adjustments on acquisition
[00:57.23]This well-established practice allows the cost of reorganising an acquisition to be defrayed without impacting on profit
[01:05.31]It has been widely criticised as a way in which ordinary operating costs can be 'lost' boosting reported profits and earning
[01:13.25]The acquisition accounting issue looms⁶ particularly large for T
[01:17.66]Its rapid transformation⁷ since 1986 from Tube Investment has involved a heavy acquisition programme and an equally heavy use of fair value adjustment
[01:27.82]Over the period it spent about $500m on acquisitions and another $100m on reorganisatio
[01:34.69]Almost all acquisitive companies make use of the practic
[01:38.51]At its simplest it allows an acquiring company to identify costs of reorganisation
[01:43.92]redundancies and plant closures  and to set up provisions in the balance sheet against which future costs can be charge
[01:50.97]But in 1990, TI was widely criticised in the City for taking the practice to the limits of what was acceptabl
[01:58.18]Fair value provisions are usually set up soon after an acquisition and released over 18 month
[02:03.92]In its 1989 accounts TI made $92m of fair value provisions,some ￡59m of which related to'additional'goodwill write-offs relating to its 1988 acquisitions.
[02:17.43]The 'additional'provision was more than half that year's pre-tax profits of $112
[02:24.43]Critics said these costs ,referred to as a major rationalisation of manufacturing facilitie
[02:30.49]systems and organisational structures in the 1989 accounts,might have been better treated as exceptionals or operating costs in what was by then an on-going busines
[02:41.70]Mr Lewinton and Mr Garner insist there was nothing wrong with this treatment-and indeed Price Waterhouse, TI's auditors⁸, did not qualify the account
[02:51.21]"We had always had an agreement with our auditors that we would not rush to finalise provisions in one balance sheet,said,Mr Garne
[02:58.78]The reasoning behind this 'second bite' at the provisions had,however ,been poorly  communicated to the Cit
[03:06.20]Some analysts⁹ have argued there is more to TI's second bit
[03:10.69]First of all, TI had 11 months after the acquisition of Bundy, in Apirl 1988 ,before the auditors signed off the 1988 accounts during which to identify potential write-off
[03:23.08]It also had an opportunity before the bid ,which was agreed, and allowed TI to do full due diligence on Bund
[03:30.70]Mr Garner said that the opportunity for further restrucucturing ,and therefore additional provision
[03:36.53]only came to light once senior members of the Bundy board left nearly a year after the acquistion and fresh ideas from more junior executives surface
[03:45.72]The debate is not academic as it has implications for TI's cash flo
[03:50.90]TI's unbroken record of strongly positive funds generation since 1986 would be severely¹⁰ dented¹¹ if some of its past provisions were treated as on-going operating cost
[04:01.01]In 1989, for instance,a tougher accounting treatment of the second Bundy provision would have meant TI's operations were actually a drain on fund

1 honeymoon   

n.蜜月（假期）；vi.度蜜月

参考例句：

• While on honeymoon in Bali,she learned to scuba dive.她在巴厘岛度蜜月时学会了带水肺潜水。
• The happy pair are leaving for their honeymoon.这幸福的一对就要去度蜜月了。

2 accounting   

n.会计，会计学，借贷对照表

参考例句：

• A job fell vacant in the accounting department.财会部出现了一个空缺。
• There's an accounting error in this entry.这笔账目里有差错。

3 aerospace   

adj.航空的，宇宙航行的

参考例句：

• The world's entire aerospace industry is feeling the chill winds of recession.全世界的航空航天工业都感受到了经济衰退的寒意。
• Edward Murphy was an aerospace engineer for the US Army.爱德华·墨菲是一名美军的航宇工程师。

4 incumbent   

adj.成为责任的，有义务的；现任的，在职的

参考例句：

• He defeated the incumbent governor by a large plurality.他以压倒多数票击败了现任州长。
• It is incumbent upon you to warn them.你有责任警告他们。

5 garner   

v.收藏；取得

参考例句：

• He has garnered extensive support for his proposals.他的提议得到了广泛的支持。
• Squirrels garner nuts for the winter.松鼠为过冬储存松果。

6 looms   

n.织布机( loom的名词复数 )v.隐约出现，阴森地逼近( loom的第三人称单数 )；隐约出现，阴森地逼近

参考例句：

• All were busily engaged,men at their ploughs,women at their looms. 大家都很忙，男的耕田，女的织布。 来自《简明英汉词典》
• The factory has twenty-five looms. 那家工厂有25台织布机。 来自《简明英汉词典》

7 transformation   

n.变化；改造；转变

参考例句：

• Going to college brought about a dramatic transformation in her outlook.上大学使她的观念发生了巨大的变化。
• He was struggling to make the transformation from single man to responsible husband.他正在努力使自己由单身汉变为可靠的丈夫。

8 auditors   

n.审计员，稽核员( auditor的名词复数 )；（大学课程的）旁听生

参考例句：

• The company has been in litigation with its previous auditors for a full year. 那家公司与前任审计员已打了整整一年的官司。
• a meeting to discuss the annual accounts and the auditors' report thereon 讨论年度报表及其审计报告的会议

9 analysts   

分析家，化验员( analyst的名词复数 )

参考例句：

• City analysts forecast huge profits this year. 伦敦金融分析家预测今年的利润非常丰厚。
• I was impressed by the high calibre of the researchers and analysts. 研究人员和分析人员的高素质给我留下了深刻印象。

10 severely   

adv.严格地；严厉地；非常恶劣地

参考例句：

• He was severely criticized and removed from his post.他受到了严厉的批评并且被撤了职。
• He is severely put down for his careless work.他因工作上的粗心大意而受到了严厉的批评。

11 dented   

v.使产生凹痕( dent的过去式和过去分词 )；损害；伤害；挫伤（信心、名誉等）

参考例句：

• The back of the car was badly dented in the collision. 汽车尾部被撞后严重凹陷。
• I'm afraid I've dented the car. 恐怕我把车子撞瘪了一些。 来自《简明英汉词典》