Leslie Seidman: Lighting Up a Dark Room at the FASB

Leslie F. Seidman
Chairman, FASB

EDITOR’S COMMENT:

You probably don’t know the name Seidman, much less  Leslie Seidman. But back in the 1960’s when the accounting rules were first being changed (causing Briloff to write the book Unaccountable Accounting), the Seidman accounting firm was one of the few who understood the significance and moral hazard of what was being laid at the foundation of required disclosure and certification of financial statements. Neither Seidman nor Briloff got the attention they deserved because they were bearing messages that nobody wanted to hear. The usual excuses of apparent “transparency” and facilitating free flow of capital and commerce were used to justify giving management the right to basically tell you what you wanted to hear if you were holding the stock or bond, or to induce you to buy if you were a prospective investor.

The eventual changes were monumental in scope, misleading in nature and essentially legitimized fraud on the securities exchanges, which had a catalytic effect on the fringe shadow markets where regulation was already spotty at best.

Now through a fluke of circumstance, Leslie Seidman has become chairman of the Financial Accounting Standards Board, and stands in a position similar to Elizabeth Warren, to change the way business is reported on Wall Street — a fact making many people nervous all over the world of finance. The FASB makes the rules on generally accepted accounting practices (GAAP). She has no incentive that we know of to do anything but the job to which she was appointed, without favoritism to Wall Street, business or anyone else. And she stands a good chance of re-appointment when her term runs out after the previous chairman suddenly stepped down.

This time there is a light at the end of the tunnel and it’s name is Seidman — a long-standing reputable name in the field of accounting. Let’s hope she is able to push through the reforms required to bring us back to days when we could actually know the condition of companies, cities, states and the federal government. Maybe we could even bring to light “selling forward” and price earnings ratios on “forward earnings”. The possibilities are endless. You may not know the name Leslie Seidman, but if the U.S. regains respect in the world of finance, it will be because of people like Seidman, Shapiro at the SEC, and Warren at the Consumer Protection Agency.

PRESS RELEASE:

Leslie F. Seidman was named Chairman of the Financial Accounting Standards Board (FASB) by the Financial Accounting Foundation, effective December 23, 2010. She was originally appointed to the FASB in July 2003 and reappointed to a second term in July 2006.

As Chairman of the FASB, Ms. Seidman is responsible for managing the organization’s day-to-day activities and leading the Board’s efforts to develop high-quality financial reporting standards that result in decision-useful information for investors and other users of financial statements.

From 1994–1999, Ms. Seidman was a member of the FASB staff. She initially joined the organization as an Industry Fellow, after which she served as a Project Manager and as the Assistant Director of Research and Technical Activities. As Assistant Director, she supervised staff members dealing with implementation and practice issues, including the FASB’s Emerging Issues Task Force, and had liaison responsibilities for the Securities and Exchange Commission and the regulators of financial institutions.

In between her two tenures at the FASB, Ms. Seidman founded and managed a financial reporting consulting firm, serving corporations, accounting firms and other organizations. Prior to her Fellowship at the FASB, Ms. Seidman was a vice president in the accounting policies department of J.P. Morgan & Co. Inc., where she was responsible for establishing accounting policies for new financial products, particularly securities and derivatives, and analyzing and implementing new accounting standards. Ms. Seidman started her career at Arthur Young & Co. (now Ernst & Young, LLP), as a member of the audit staff, serving clients in the retail, publishing and venture capital industries.

A member of the AICPA, the American Women’s Society of CPAs, and the Institute of Management Accountants, Ms. Seidman earned an M.S. degree in accounting from New York University and a B.A. degree in English from Colgate University.

lfseidman@fasb.org

 

2 Responses

  1. Prior to her Fellowship at the FASB, Ms. Seidman was a vice president in the accounting policies department of J.P. Morgan & Co. Inc., where she was responsible for establishing accounting policies for new financial products, particularly securities and derivatives,

    What was the time-frame–what products. Could it overlap the period 2003-4 when they were cooking up the off-balance sheet financing securitization?

  2. This is great of course and will be very well accepted I believe now, by all concerned. Takes me back though in the days when all of a sudden, the internal auditors, the state auditors, the fed auditors, all called us to let us know when they would be there and what files to pull. I knew then we were in trouble. It goes without saying that “surprise” audits are still very key to well run operations and those that run a tight ship are going to have it made. Can you imagine. Calling in to let us know which files to pull for audit. Like I said, I knew it was the beginning of the end.

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