Mike Mayo Takes on Citigroup (A)

Posted: 4 Feb 2012

See all articles by Suraj Srinivasan

Suraj Srinivasan

Harvard Business School

Amy Kaser

affiliation not provided to SSRN

Date Written: October 24, 2011

Abstract

The case details the conflict between Mike Mayo, an influential banking analyst, and Citigroup about what Mayo considers aggressive accounting policies. Mike Mayo questions Citigroup's lack of a valuation allowance against its deferred tax assets despite Citi's recent losses. The case discusses the economics of and accounting for deferred tax assets. It also focuses on management-analyst relations and challenges faced by analysts in providing a negative opinion on companies. The inclusion of deferred tax assets in Tier 1 capital and implications for regulatory capital are also discussed.

Learning Objective: The case can be used to discuss accounting quality in general and accounting for deferred taxes in particular. The case is also useful to discuss management relationship with analysts and the sell-side analyst industry.

Suggested Citation

Srinivasan, Suraj and Kaser, Amy, Mike Mayo Takes on Citigroup (A) (October 24, 2011). Harvard Business School Accounting & Management Unit Case No. 112-025, Available at SSRN: https://ssrn.com/abstract=1998975

Suraj Srinivasan (Contact Author)

Harvard Business School ( email )

Soldiers Field
Boston, MA 02163
United States

HOME PAGE: http://www.hbs.edu/faculty/Pages/profile.aspx?facId=10700

Amy Kaser

affiliation not provided to SSRN ( email )

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