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Proposed New Accounting Rules Rile Franchisors, Franchisees
In the wake of accounting scandals involving Enron, WorldCom, and other companies, the Financial Accounting Standards Board (FASB) is upgrading many rules to force public companies to provide more information about their finances. One of the areas it is addressing relates to how the primary company's financial obligations toward “variable interest entities” are shown on its balance sheet. These rules are aimed primarily at companies that have controlling interests in other companies and, as was the case with Enron, potentially could use those companies to hide their own financial obligations.
However, the proposed rules, known as FIN 46, also affect franchisors and franchisees because they are considered variable interest entities. The International Franchise Association (IFA) is opposed to this aspect of the rules because franchisors and franchisees operate in an arms-length relationship that does not incorporate all of the aspects of legal liability of other types of variable interest entities. Thus, IFA has argued that requiring consolidated accounting would not make sense.
Below are excerpts from the testimony of Peter Salg, president of QSC Restaurants, a Wendy's franchisee, before members of the Committee on Senate Banking, Housing, and Urban Affairs, to express IFA's concerns about how FASB FIN 46 will affect the franchising industry. Mr. Salg gave his testimony at a hearing on Nov. 12, 2003.
Major Differences In UK, U.S. Copyright Laws
This article highlights how copyright law in the United Kingdom differs from U.S. copyright law, and points out differences that may be crucial to entertainment and media businesses familiar with U.S law that are interested in operating in the United Kingdom or under UK law. The article also briefly addresses contrasts in UK and U.S. trademark law.
The Article 8 Opt In
The Article 8 opt-in election adds an additional layer of complexity to the already labyrinthine rules governing perfection of security interests under the UCC. A lender that is unaware of the nuances created by the opt in (may find its security interest vulnerable to being primed by another party that has taken steps to perfect in a superior manner under the circumstances.
Strategy vs. Tactics: Two Sides of a Difficult Coin
With each successive large-scale cyber attack, it is slowly becoming clear that ransomware attacks are targeting the critical infrastructure of the most powerful country on the planet. Understanding the strategy, and tactics of our opponents, as well as the strategy and the tactics we implement as a response are vital to victory.
Removing Restrictive Covenants In New York
In Rockwell v. Despart, the New York Supreme Court, Third Department, recently revisited a recurring question: When may a landowner seek judicial removal of a covenant restricting use of her land?
Legal Possession: What Does It Mean?
Possession of real property is a matter of physical fact. Having the right or legal entitlement to possession is not "possession," possession is "the fact of having or holding property in one's power." That power means having physical dominion and control over the property.