Quasi-Reorganizations: An Analysis of Accounting Restructuring on Firm Performance
Posted: 24 Feb 1998
Abstract
A quasi-reorganization pursuant to Accounting Research Bulletin (ARB) 43 restates the deficit in retained earnings when a firm has engaged in a "fresh start" by transferring the deficit to the paid-in-capital accounts. For publicly traded firms the SEC requires them to also revalue assets and liabilities to reflect current market values. This is consistent with the SEC's public disclosure requirement of providing a fair and accurate statement of the economic condition of a new firm.
JEL Classification: G33, K22, M4
Suggested Citation: Suggested Citation
Nachtmann, Robert and Shastri, Karen Andrea, Quasi-Reorganizations: An Analysis of Accounting Restructuring on Firm Performance. Available at SSRN: https://ssrn.com/abstract=55460
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