Dollars and Jens
Wednesday, August 04, 2004
The Krispy Kreme saga continues.
And while the company has defended its treatment of reacquired franchise rights as being in accordance with GAAP, one attorney said that may not matter to the SEC.Man I hate lawyers.
"Something can be in accordance with GAAP and yet not be a fair representation of the financial presentation of the company," said Alan Berkeley, a partner at the Washington law firm of Kirkpatrick & Lockhart.
"When Sarbanes-Oxley requires the CEO to make a certification, it requires that it be a fair presentation, not that it be a fair presentation in accordance with GAAP," Berkeley said.
Of course, that's not quite right; it's the legislators who made this ambiguity. If the lawyers create clarity — even after the fact — that's a good thing; if they create more ambiguity to exploit, that's a bad thing. Making people guess whether there's a jail sentence behind door number two is a miserable way to run a legal system.