From: Tony Tinker (TonyTinker@msn.com)
Date: Mon Nov 04 2002 - 18:56:46 EST
Jerry -- minor comments to your blue ones: I take this to mean that from an accounting perspective there are decided advantages to estimation at historical cost even where (if) estimation at historical cost is a poor method for describing the real changes in the exchange value of means of production. Yet, it is the latter which has by far the more importance from the perspective of political-economic theory. I don't want to overstate the importance of the historical cost regime: in many areas (although not perhaps generally) such as pension valuation, or oil and gas, current values, or present values are used. Nevertheless, 'caution' leans towards historical cost (even though there are many cases where such caution has proved to be extravagent!). I don't want to concede entirely your latter comment, "Yet, it is the latter which has by far the more importance from the perspective of political-economic theory." Surely, it could be argued that, having more auditable numbers (historic cost) is also very important from the perspective of political economic theory. Everything turns on what we make of the latter. Fraternally, TT
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