Friday, October 23, 2015

Other links for BFR posts....

The Chaos That We Paid For- Thoughts While Watching Media Coverage of Occupy Wallstreet
posted originally Wednesday, November 12, 2014 and for which the perps/secret state-4th reich, and what ever is their camp of those waging the 'asymmetric' war of the 4th Reich against the US, Russia and Britain, and have put my dad on their aggressive radar screen using their wifi transmitted psi-op to disrupt any further writing and articles that he and would do together.

The average American citizen watching evening news is stunned at the amount of political violence that we are seeing on Wall Street and our university campuses. This political violence may be telling us that we are seeing the breakdown of society, or the core and seeds of the new revolution that Thomas Jefferson suggested the nation might need in its future. If so, whose revolution is it? Are we experiencing a correction which the indignant populous is demanding? Has the need arisen for a correction in the course of the federal government where they have forgotten who serves whom? Otherwise, why is there this sort of turbulence and what is its root? These questions which spur study of this new political awakening could be a good thing, with conditions. It is a good thing if in keeping with the customs and conduct our Constitution and Bill of Rights have laid down since our founding. If the wild conduct in the streets contributes something of value that is able to merge with our sacred documents from our Founders, then from where have all these demonstrators come from what sounds like 'Marxism'? The answer seems implied or hidden behind a camouflage of words, which is a typical known and slick Marxist tactic from his Jesuit "white-is-black, black-is-white" training ( , II. "Theory of Knowledge").

Diluted ideals masked behind crafty and academic rhetoric enjoy reduction to slogans or just plain lies. Attempting to understand roots of that, have us to search for sources. One also should be aware that many of our colleges and universities are teaching the privileged that their prosperity has been stolen from the “proletariat” members of our society and around the world. Meanwhile recognizing the flipside, since WWII we have engaged in aggressive forms of corporate social control some characterize as ‘over-regulation’ to appear to reign in corporate power and agency abuses. What also has been sounding like class warfare, is generally foreign to our democratic customs and is more redolent of the class-stratified 'old world'; in the USA virtually anybody can buy a first class ticket. Those prospering class warfare have the philosophy that the “bourgeoisie” rich must overcome their environment by sharing what they had stolen from the working class, such as what Dickens wrote in “A Christmas Carol” using the character Marley's ghost. Of late, we’ve been hearing the activists' slogans virtually mindlessly declare statements the "rich" must pay higher taxes, which is what the very wealthy before Wilson’s Administration spurred the masses to demand to obtain the Income Tax Act. Granted, if the Bush era tax breaks lapse to the Clinton era tax brackets, the government would come closer to having significantly improved its revenue stream.

The Old-world Marxist, Jesuit influenced sorts have a preference for rabble-rousing; those practices and policies have rooted in new world, but have polluted the ground and spurred erosion far from the liberated Republic our founders left us. Perhaps because the current activist effort seems too confused, relativistic and collectivist, Thomas Jefferson's offhanded remark that one day the United States may need another revolution appears to have taken root in compost rather than a fine flower bed of vigilant individual liberty in a commercial framework of what had been non-corporate private enterprise. Indeed, the reader also may be surprised to know that the origin of highly polished, atheistic Jesuit-Marxism that we’re watching and hear used on our streets and around much of the world, also is used in school texts in the USA. This rhetoric is cleverly mingled with anti-private enterprise propaganda all from within our own “free”, United States of America. With our own open arms, sometimes by ballot, we have welcomed these very patient calculating subversives to hijack words in our dictionaries but not having our definitions.

 Thus the words in the discourse that we think we are hearing have to be parsed because politically correct word games and slick double-speak are an appendage of bigger political games, which are serving as part of the destruction of the United States of America.

 Meanwhile, natural concerns arise with American parents who have hocked the house to educate several college grads. When the bill-payer challenges the demonstrator, the responses are virtually never satisfying. The parent is likely to conclude that the child is majoring in “sloganeering” rather than an academic curriculum. The evidence is clear: our academic communities often are indoctrinating- a Jesuit tactic and practice, rather than educating our children. Typically, many parents pay the tuition bills for our children before sending them into the world. We allow them the freedom to explore and grow in their own talents until the world sees them as we do, very special. We proudly encourage them to explore just about every occupation their degree allows. Our hopes are based on our own experiences and means of communication in the relatively free economic society of our time. We parented what we thought were duplicates of ourselves and we were sure that our children could do no harm.

Then, one day we are watching the evening news and we see our very special child among the disheveled demonstrators who were defying uniformed security personnel at a down town office building. And that evening we learn that lawyer's fees are almost as expensive as a college degree. Not our child! How did our child become what sounds like a flaming “Marxist Young-gen”? Moreover, how could those in positions of governmental, cultural, social and academic authority ie, “they”, have injected some form of control, even a domination throughout our society, appearing to have hijacked our children? “They” push a button and debt-bearing, educated lemmings come running... With that societal domination, what has happened between our front doors, the education for which we paid for our children and THEN in thinking of the “Big Picture”, the door to the offices of the corporate world and one has to wonder – its personnel directors? And in the unraveling, we'd seen the effect of the 'Wall-Street'-Washington connection as a component prospering the global corporates, which have employed many of those same affected personnel directors. As it were, who hired the Personnel Director? How do THEY fill companies in those buildings and the whole system with such as these who seem to be hijacked by neo-Marxists? This is how all of this is sounding – like Marxism (most people only see that, rather than understanding the Jesuits' order which is disorder and its asymmetric war on the US). In examining society to find answers, let’s start attempting to understand what is happening in the schools.

 For years questions have arisen about whom? How? Or When? How and when topics of these sorts are discussed on conservative talk shows, letters to the editor and a few from the conservative wing of politics. These so-called conservative constituents were suddenly troubled by a large cadre of what seem to be talented political hijackers who, ignoring the Constitution have emerged in what we thought was our relatively pristine America. Slowly, patiently (Jesuit strategies of 'laying-low') with both campaign contributions and our own tax-money, these for-sale, leftist “sleepers' were buying our political parties, one after another, jerrymandering safe voting districts. It was only a matter of time before political hijackers ‘owned’ most of the federal tax-paying voters’ votes. Eventually voters sent 51% of ‘free-rider’/'free-lunch' minded politicians to Washington D.C. and our state capitols; these leftists of both the social and corporate welfare sorts meanwhile have been looting the kiddy. This short commentary describes nearly a century of indoctrination in our society in general, and our schools in particular.

 The United States of America has been eroded by Jesuit-socialism and its more violent, leftist form found in Jesuit-Marxism, as well as corporate socialism, aka “fascism”- another Vatican influence, while the US has exported both for more than a century. Both are of the ‘welfare’ sorts to the left of what the founders left us under the Constitution before 1859, and neither are self-sustaining for our republic because we’re not keeping what the Constitution had left us and the Founders by that. Moreover, presented under other names and modified out of its original political and economic context with regard to socialism, the Jesuit-Marxist philosophical influence has been exerted in our society and used openly as the method of teaching in many American schools of higher learning. Again only under different names, eventually it also found its way down through all grades in compulsory education. The popular title today for it is “Progressive” or ‘outcome-based’ education. A review of some history will help give us insight. In the middle of 19th Century Germany, Herr Marx (recall that according to the Jesuits, Marx was trained by Jesuits) was a new political philosopher on the scene who could easily turn words into violence in the turbulent societies in that war ridden era, geographically now among the consolidated German ‘states’. Fearing constant insurrections and mob violence which had been happening over that period of time, the authorities warned that social unrest which Marx and his group had perpetrated would get them invited to leave Germany; Jesuits often likewise were ejected from countries they were attempting to subvert for the purpose of achieving the Vatican's Holy Roman Empire expansion (

Ernst Haeckel and the Struggles over Evolution and Religion, p.95. Germany ejects the Jesuits, which vindicate with the subsequent Pope. Germany's new emperor William II (1888-1918) had conflicts with Chancellor vonBismark (1890) and Germany begins its ascent into achieving the Vatican's contemporary secular state for 'Holy Roman Empire'. See also, - Jesuits and Their Strategy to Destroy Britain, Section: "Jesuits and the Two World Wars").

Given what was happening across central Europe at that point however, and its own problems with shifts in its old feudal, exploitative, compromised and confused ways, Marx's dedication to his new philosophical bent proved too deep for a mere warning from the authorities. The same thing happened in France where the Marx family “society” tried to radicalize seminary students ( “Jesuits and Communism”). Because his philosophy encouraged violence, the French government deported the Marx’s to more liberal, Victorian England. There the Marx philosophy found Edward Bibbins Aveling (who in 1886 co-authored the first English translation of Das Capital), a like-minded radical who had traits the Marx family admired. He was a highly skilled dissembler, and with his adroit lies, he could easily sway audiences. As Marx's daughter, Eleanor, also sadly learned, he could attract women. Although English by birth, Aveling felt no loyalty to the Monarchy. He preached atheism and generally diminished the character of Britain. He would say whatever his audience wanted to hear, and flatly, it did not take long for his audience to realize that Aveling loved to make promises based in lies. As it were, Aveling's intelligence and cunning strengthened the presentation of Marxism. Aveling was a brilliant, capable, leftist organizer who was labeled an anarchist in British and American print. He founded many side-organizations such as “ethical humanist societies”, with names and functions purposed to confuse the opposition.
By sheer luck meanwhile, Marxist agitators where in Britain when Queen Victoria called for some sort of ‘reasonable’ democratic reforms. With that political move to the Marxist advantage, Aveling was able to achieve some access to the British political process. It was through these changes that the “left” now had power to enforce his and Marx family ambitions. Probably under Jesuit influence, one of these organizations Aveling founded in the 1890s in England was the “Fabian” Society and was quite effective in recruiting middle and upper class university students. Named for Roman general, Fabius Maximus, Maximus had been known for using those sorts of attrition tactics for which that Roman general was known to use against Hannibal (
Aveling used the name most likely because its cadre would serve as a connected, well positioned but insidious and gradually divisive element from within. Aveling recruited the Fabians among the university social clubs. An example of this is portrayed in the 1983 British film “Chariots of Fire” which has a scene that takes place in a gymnasium at Cambridge where Abrams was sitting at a piano playing Gilbert and Sullivan melodies. Above and behind the piano is a banner for the Fabian Society. In this scene a debate is taking place in 1919 between the melee-mouthed Fabian recruiter and a young aristocrat. He is asking the Fabian why he didn't serve the King or was unwilling to serve the King in the “Great War”. The Fabian recruiter responded with a flimsy comment, referring to “the home front”. The point is made that the Fabian social power protected its recruits in that particular case –war – however, we now see that by 1919 Fabianism had taken on a life of its own. Moreover, recall that the writing of two famous British authors, Dickens and George Bernard Shaw described a characteristic of the modernizing ‘old world’ - 'class-struggle' in virtually sclerotic, class/socially stratified Britain, decrying terrible working conditions over there and in Europe in general at that time.
Not without valid complaints, these modern Fabians moving about in the English-speaking world were a part of the early, loosely organized Marxist system. Early leaders were, without their conscious knowledge -- fertile ground – like children inculcated with Jesuit influenced, Fabian socialist ideals. The clever trick was to use children’s natural idealism and ignorance that also were natural weaknesses into which Aveling played. For example regarding children, the so-called Greek “Civil War” after Jesuit/Vatican spawned WW2 (See also, - Jesuits and Their Strategy to Destroy Britain, Section: "Jesuits and the Two World Wars"), which took place on the northern border of Greece in what bordered Albania, Bulgaria, and Yugoslavia, was not a war for territory, but a war for stealing Greek children and young people. When American author Nicholas Gage was 7 years of age, his mother Eleni rescued her children and helped their escape.
A communist firing squad captured and executed Eleni, described in Gage's 1980's era book and movie, Eleni. In part as a result of Greece's open repatriation policy, those thousands of stolen children who were trained as communist insurgents, and their counter-parts among the "Austerity" sorts are today on the streets of Athens during the economic upheaval in Greece, reputed by Greek sources. Jesuits and using Hegelian dialectic strategies, plan far in advance to foment instability in targeted societies to serve motives beyond the demonstrations seen by the naked eye. German domination interests of late, meanwhile which are characterized by their demand for fiscal union to stabilize the economies of EU countries like Greece and Spain, would be used as a reason to quell the demonstrators’ demands, or the flip-side to serve as the solution the demonstrators would demand to embrace. Here the potential is that insurgency birthed a century before in what were principalities now incorporated into Germany, along with the Vatican, are potentially contributing to costing Greece its sovereignty.
Certainly sadly with a Concordat, the Greek Orthodox Church may have put Greek sovereignty at risk. In earlier times with the Vatican which continued its interests to remain the dominant religion, and later the Rothschilds, their sponsored insurgencies and in the larger context – wars – were used for ‘kingdom-towing’ ie, taking over countries and giving that land to the victor. Today using somewhat different methods but often with insurrection, we see similar transfers attempted. This remains a tactic and sadly our 1% are part of this funding with their means and for their family-owned companies; the old Kaiser era 'cold-war' remains a way the 1% here and royals abroad enjoy voters' wallet ride while they're lining up their ducks for another region of valuable resources to 'kingdom-tow' with subversive tactics, 'hot-spots', needs for 'peace-keeping', or some other contrived crisis.
 In Britain the attempts were under way for social and civil power transfers by the Secular Society with its ‘free-thought’ movement which also included Aveling among its members. He edited for the “The Freethinker” a secular humanist magazine established in Britain. After affiliating with this group, in 1881 he interviewed the great scientist Charles Darwin in which Darwin's son, Francis also was present. In that interview, Aveling pressed the question of Darwin's 'faith'. Darwin repeated each time that he was an 'agnostic'. Aveling lied in his notes that Darwin was an atheist. Darwin's son, Francis, exposed this lie in a footnote he added to his father's notes. Aveling's lie from that interview had served to give power to the beliefs of Evolution, which in a Europe affected by reductionist, survival-of-the-fittest sociological filters, Evolution would become elevated to the level of natural laws, theories like gravity or of physics such as thermodynamics. The conjecture of Evolution however does not survive those tests and hurdles to be deemed as achieving scientific theory. The fossil record similarly fails to support Evolution as a true scientific theory.
 Notwithstanding, with the help of manipulative minds like Edward Aveling, the success of Marxism prospered in the West, also taking more root in the US with its large influx of Germanic immigrants. After the Marxists' great success in unionizing the coal mines in England after WWI, the British generally attempted to reject Marx and this philosophy although the British upper class saw socialism as way to control resources and society by the appearance that socialism was looking out for those of the weaker strata in that society. Thus it was the Coal Board after WWII that formed the nucleus of the freely elected socialist (which had its seeds in Marxism) government in Great Britain. Because of support by the Old World’s elite layer, Marxism's patience is one of the characteristics of its success; it is then enabled to plant recruits and wait as much as a century for the harvest. Even before Marx's death, with a strong source of funds coming from the United States where there was a group which formed the Socialist Labor Party of America (SLP) established in 1876 as the Workingmen's Party, of Marxist-socialist ideology it could be said it was finding some root in the US . Much of their rhetoric came out of the American Midwest where a large number of immigrants from German regions had settled. The Midwest was an 'expansionist' area; except in some pockets of urban areas, Marxism couldn't take the same hold in what had been the 13 Original States of the Union. Chicago served as the center, but led to a split in Marx’s form of socialism. The violent portion of the philosophy worked with the 'proletariat'-like lower classes among those recent immigrants who were feeling disenfranchised and in dangerous and marginal jobs, while the Fabians actively recruited the bourgeoisie, ie, the Middle class. Working conditions anyway generally had eroded in England and US, with little to protect employees from abusive managements and owners and increasing amounts of 'fascism'. This in the US was by the family owned companies which after the US Civil War and foreign moneyed interests enjoyed assess to and protection by the public weal. Abroad that was natural in monarchies and associated feudal societies, whereas in the US, this was a clash to the Republic under the broken Constitution, but increasingly a self-interest demanded by the wealthy commercial families in the US contrary to the interests of all other voting, land-owning Americans). Meanwhile Aveling's double-speak was so clever with hidden meanings and political intent, that some American newspapers were absolutely recruited into Marx’s Germanic, turbulent version of socialism.
By the end of the 19th century after Aveling had come to the States, however, he had fallen gravely ill with Eleanor nursing him to health. His amoral mind could not let him keep a promise to marry her; meanwhile he still had a wife in England from whom he was estranged. In 1898 in spite of years of relationship with Eleanor, Aveling married a show girl. The betrayal led Eleanor to suicide. At this point in time Marxism had leadership and management deficits. The family members were dead, the primary leadership was in shambles, and when Aveling's internal infection returned, there was no Eleanor to nurse him. Aveling had died however, by the time John Dewey, known for eroding the quality of education, and his angry socialist beliefs would begin to get traction. Moreover, sharing in the socialist philosophy with Dewey was a noted physician, chemist and art collector Albert C. Barnes. A baseball analogy will help some older readers understand the simultaneous events taking place in politics, society, and commerce. Every sports fan enjoys watching the disciplined team effort that brings screaming fans to their feet. Despite individual talent, sharp speed and well-trained motion, a star athlete however, is only as good as his teammates will allow. The exception to a team's possession of a single gem is a sports team having a collection of stars such as the turn -of-the Twentieth Century, Chicago Cubs infield, Tinker who was at Shortstop, Evers who was at 2nd base, and Chance at 1st base. The efforts of these three ball players formed a record setting double play combination that sparked their team to five World Series victories. There it is - talent and teamwork .
From the wave into the US mid 19th century of feudalist, old-world immigrants, a number of whom were Germanic, Catholic (40% of Germany even today is Catholic and many of its Royals also are Catholic), but many were certainly sympathetic to the Marxist and socialist cause in that same period, perhaps were staffing the radical fringe of big-city newspaper editors. These happily were printing original class-warfare material that could be read by transplanted Europeans then living in the American Midwest. Since the context did not matter, the content however did. And had the same Tinkers to Evers to Chance combination: developing in government, in society and in commerce were found a similar, but Jesuit- Marxist-Fabian, political games playing combination in Aveling, Dewey and Barnes.
 Dewey was an angry educator whose 'Progressive Education' plan was mocked as ineffective, and characterized as “Special Education” for college level students. This John Dewey (not the father of the Dewey Decimal System) was a bitter leftist whose goal would use any means to institute his “pragmatism” plan for American education, in which he'd crafted a flimsy, insubstantial body of material that barely taught reading, writing and arithmetic but was championed as ‘progressive’. This Americanized form of socialist-Marxist philosophy and those who followed it were known as “Pragmatists” (, who believed in the compromise of principles and truth. Dewey’s plan would produce people ineffectively educated to read and handle complex subject matter and sophisticated mathematics, meanwhile indoctrinating them into an updated version of Marxism, to the point that some educators once labeled “Pragmatism” as garbagism”. Given its generations of entrenchment however, the result is what few educators today have the nerve to say, Pragmatism equals "dumbing-down". Reagan Administration Cabinet level, Charlotte Eserbyt (daughter of a 'Bonesman') authored "Dumbing Us Down", helps with that most likely Jesuit influenced effort to erode the quality of public education, and also was a way to encourage parents to send their children to Parochial schools for further Catholic inculcation.
Even during the supposedly conservative Ronald Reagan's Administration, with George Bush as his Vice President, and Knight of Malta CIA Director William Casey, this 'dumbing-down' erosion of the quality of US education was ramped-up. In turn, in the past 4+ generations, the dynamic growth of 'Pragmatism” is a ‘planned obsolescence’ that has corrupted virtually every body of knowledge and profession, science, communication, commerce and especially politics. Indeed, everyday in our schools the quality at all levels the system has deteriorated and been eroded by design. Dewey went to the source by embracing socialist-populist versions of Marxism with the Aveling additions as a tool for Dewey's end. After finishing college and into his early teaching career, he associated himself with the philosophies of Eleanor Marx and Edward Aveling with the intention of merging the developing of his “Progressive Education” with the moderations of Marxism sprouting in the US. For example, by using a tactic called “Adjunct” Professors with funds provided by off campus sources, started just after the turn of the Twentieth Century this education strategy also was occurring in other English speaking countries.
 Although separated by time, the third member of this 'infield' is Barnes whose foundation employed Dewey, which provided the funds for Dewey's inspiration. Barnes is known for inventing ARGYROL, a Venereal Disease prophylactic chemical. First used by the French army, it later was used by all the Armed Forces on the Western Front in WWI. Barnes' fortune came from the French buying ARGYROL, and the means from that allowed him to express his taste in French Impressionist art, until he had purchased the largest private collection of French Impressionist paintings in the world, now known as the “Barnes Collection”. The most likely German influenced, Philadelphia art community however, viciously rejected the collection, which left him embittered. In other cases similar to Barnes’ foundation prospering Dewey’s ‘Progressive Education”, John D. Rockefeller and Rockefeller family foundations had a “General Education Board” (beguiled by the Vatican, Rockefellers also established the National Council of Churches and the World Council of Churches to give the Vatican stronger hold in the US and around the world). With its limitless resources, its mission and aim for their interests was and remains to use docile people “who would yield themselves to be molded.” According to Gary Allen in The Rockefeller File, Gates added from the Board’s Occasional Paper No.1, “The present educational conventions fade from our minds, and unhampered by tradition we work our own good will upon the grateful and responsive rural folk”. The foundations of the very wealthy - Rockefellers, Carnegie, Ford with significant amounts of money in the early 30’s began supporting Jesuit influenced, Marxist Dewey’s dysfunctional, flimsy education framework in many urban and rural areas of the US.
Meanwhile, wealthier families and Catholics would be disinclined to have their children educated in the public schools, preferring better quality education or at least fundamental education offered in tuition based and parochial education. In support of this article’s co-author, Allen also observed that traditionalist teachers resisted Dewey-ism. Backed by foundations however, prominent universities such as Columbia, Chicago, Pennsylvania, and Stanford formed research and experimental stations purposed to suborn American education, upset the American system, and supplant it with a socialist state. These foundations also backed National Education Association "NEA", which began to throw its weight behind Dewey’s program. This included Progressive Education textbooks produced for nationwide use to address the decentralized school system in the US. NEA’s 1934 report stated that “A dying laissez-faire must be completely destroyed and all of us, including the ‘owners’, must be subjected to a large degree of social control” (Gary Allen, 1976- The Rockefeller File, pg46). Per Allen, Congress’s Reese Committee’s investigation of foundations reported that “indeed, something in the nature of an actual conspiracy among certain leading educations (in the US) to bring about socialism through the use of our school systems”. In a strange irony, Barnes invented ARGYROL as a sexual prophylactic; where then is the academic prophylactic for today's children, students and even society who have been abused by Dewey's Pragmatism, and funded by very wealth, probably Jesuit influenced Americans.
Barnes' wealth paid for the likes of Dewey's “Adjunct” strategy, and funding from sympathetic sources gave Dewey and Dewey-ism significant admission to virtually any campus in America and providing socialist/softball Marxist materials into the US education system. As planned obsolescence goes in the use of plan to render something into an inferior form or condition, in time this Dewey-Fabianistic strategy eroded the schools but also eroded US commerce, its hiring practices, managers and its “Human Resource Directors”. With the help of the wealthy and elite, that socialist-Marxist material spread, and had been changing governments and commerce around the world including our own. At the present time the wealth redistribution charades slickly postured in the socialist/Marxist influenced apparatus we’re seeing, has been and is being prospered also by corporate profiteers, policy makers and social engineers all obsessed for control who think our lives and resources are their final victory. It’s a system that denies God and erodes the quality of life, liberty and the pursuit of happiness for everyone. To the contrary however, God told Daniel – this "King of fierce countenance" is broken without hand – by the appearing of the Lord Jesus Christ. The corrupted system that throws away any opportunity for its victory, God vanquishes it for liberty that glorifies His NAME. He is the 'prophylactic' that our children, students, and society desperately need. Psoras, Andrea 2012/2013

Subsequent to co-authoring this article with one of my loved ones, he began encountering A GREAT DEAL of harassment through the WIFI, such as visions of people and foul, creepy dreams. Most people are ignorant that WIFI is hack-able. Although I'd already encountered a great deal of aggressive targeting by the Intelligence Apparatus and the Jesuits, that in exposing the corruption eroding the quality of education and life in the US, it had not occurred to me that my family would be harassed and targeted.

In 1981, the Lord had me come across the witness and biography of Dr. Alberto Rivera, a former fairly high ranking Jesuit the Vatican used in the 60s to infiltrate and compromise Evangelical Christian ministries in Roman Catholic countries in Latin and South America. Most people also would not understand the Bush/Skull-Bones/Jesuit ascendance, their use of SMOM Bill Casey as Reagan's CIA Director who further connected the CIA and US Intelligence with the Vatican, and Reagan's Concordat with the Vatican under the agenda that it would break the Soviet Union and the 'Cold War'. Constance Combey's authored her book, "Hidden Colors of the Rainbow", during Reagan's First Administration. What she was observing were the leaves on the tree of Jesuit entrenching with its Intelligence Apparatus connection and shortly after the Vatican Concordat with the US during Reagans's first term, and thus increased Jesuit access now via and using the US Intelligence apparatus. The Jesuit use of 'black' occult, along with its use anyway by US Intelligence with its Psychological operations, but all of this gained further traction. In time more aggressive targeting began against minorities, now including additional white ethnic groups that the Vatican wanted to punish and oppress. This included Greeks and people leaving Catholicism for 'protestant' denominations and evangelical, or Pentecostal Christianity. GHW Bush meanwhile after having been Gerald Ford's CIA director would become Reagan's Vice President. Virtually if not all secret societies are co-opted or controlled by the Jesuits and their occult interference. As it were, Skull/Bones interests are dominated by Jesuit interests. I've said that Skull/Bones and those anyway from secret societies and our NSA, CIA established using high level Catholic Nazis, etc are all zombies for the Jesuits and their White-is-Black and Black-is-White inculcation and dissociation. Increasing amounts of discrimination have ensued, while throughout all of American Society, government, regulation, environment increasing 'planned obsolescence' has ensued. All of this also reflects the 4th Reich's asymmetric ie commercial and cultural war it vowed at the 1944 Red House Strasbourg meeting to continue to wage (Lebor. Mail on Line, 9May09, "Revealed: The secret report that shows how the Nazis planned a Fourth Reich the EU").

We've needed to repeal the US Concordat with the Vatican. Perhaps we also should revoke Georgetown's charter as well as revoking all charters to every Jesuit college and university. We perhaps also should withdraw funding and state support for every catholic hospital, as well as revoke the Catholic education system are require all students in the US to have public education. Similar to the orthodox which send their children to after school education programs in that religion and those languages, but certainly remove all state support for religious institutions as many 'denominations' and other religious groups in the US receive no direct backing by federal government. Even understanding "United Way" giving, is to understand state support for religious works often cloaked in charity.

We must consider what will help eject Jesuit and Vatican influence, as far as to shut the NSA and CIA, in addition to repealing the Concordat with the Vatican. Europe's problems are rooted in Vatican interests and its use of Germany as its contemporary secular state to attempt domination again by Holy Roman Empire. We need to understand the elephant in the room and how it has contaminated a great deal of our society, our civil institutions and what had been the Republic, which the Vatican and Jesuits hated and assassinated Lincoln to destroy it and the Constitution. The US 1% were babes in the woods for Jesuit occult. That our wealthy were co-opted by Jesuit tactics to achieve Jesuit ends isn't a mystery, but that they need to repent so that they too can get liberty is part of the real battle that we must wage.

Tuesday, April 5, 2011

Individual Liberties unmolested by abuse and tyrrany-what if von Stauffenberg had succeeded?

Recently I began reading Alex Constantine's "Virtual Government" after I had found some information on the Fourth Reich. I'd known of Hartrich's "Fourth and Richest Reich", a very cheerleader OP Mockingbird book published based on his European Bureau desk work for WSJ or Newsweek, or something like that after WW2, after the Third Reich transitioned its war effort into the commercial war with Bormann's and probably the Rockefellers' plans under the "Fourth Reich".

Last weekend 1 apr 11, I watched "Valkyrie" (and two weeks ago, "Inglorious Basterds" and "Patton"; Schaffner was an F&M grad). That weekend after seeing Valkyrie, while reflecting on von Stauffenberg's effort to liberate Germany from the Nazis and their counterfeit of the Teuton 'soul' of Germany, it occurred to me that the nazis didn't have an honor code nor any breeding whereas von Stauffenberg and his group did. The character despised what the Nazis were doing, also despised the camps and the secret police, et al and wanted to shut down the camps and imprison the Gestapo and SS.

And he was a great loss to them; executing him however also left us the the overbearing, bastard side of Germany, rather than the leadership that best or bettered Germany to itself and the World. What now is exists, lurks, looks for what can benefit it from sucker punches, conceit.

I also realized that had von Stauffenberg been successful, the Fourth Reich would not have happened. Germany would have been de-nazified which if one remembers at the end of "Patton" when they ask him why didnt he denazify his quandrant. Apparently however that wasn't done and in the US we also sanctuaried many high level nazis other than their scientists. Sadly others like Wilhelm Reich was holed up in the US Department of Agriculture and off'd at an early age just after the war. His "Mass Psychology of Fascism" is an insightful read to grasp what happened in Germany as well as what was and would happen in the US after we disgraced ourselves by partnering and making a home for mass murderers and sociopaths. Today we've got this problem and if one had listened carefully to the Bush 2 admin or even some of Obama, you will realize what you're hearing.

The world would be and would have been after that war, very different. We would not have had the cia, the nsa, the coldwar, perhaps the british would still have its 'empire', there would not have been the coldwar and 'Warsaw Pact'; and those countries would not have been Soviet satellites. The central banks would not have the power they do, except for Rockefeller and his interests, but there wouldnt even have been 911 and 'Global war on 'terror' ' if people understand the difference between von Stauffenberg, his group, the Germany they wanted and the Fourth Reich of Bormann, et al that we have today and had after the loss of von Stauffenberg and their effort, the Third and Fourth Reich's control of Germany, Europe, Great Britain and actually de facto the world.

We would have had no cold war, no global war on terror which is another money maker after the 'cold war' sort of stopped. We also may not have had the directed energy-'nonlethal' weapons, and perhaps also not the nuclear bomb and other nuclear weaponry. But there also wouldn't be this US and I also suspect German and possibly if no israel then no mossad, intelligence apparatus that has been a 5th column for international fourth reich interests, nor their desperation to self immolate the US, stomp, trample and pathologically defer or enfranchise that maggotry - society driven by lust and fear and often is mediocre, and awarding a business school named after the father of 'planned obsolescence'. Now this would be disgraceful and a form of treason if the founders were alive. We would still have Lehman Brothers, Bear Stearns, a better economy and healthier commerce, no 'free' (non-tariff'd) trade agreements including NAFTA, no 'fast track' no "trade promotion authority' no PNTR with the PRC, less wealth stratification in the hands of a few and it would be more broadly distributed among the many; less power of the m aggotry their lusts and fears...

In the US we would not have the degree of insidious corporate colonial/neo-feudal problems that we do and the german footprint would have remained in its former self, perhaps divided to suit the fury of the russians, but there wouldn't not have been the internationalization of national socialism, perhaps no israel (although the 'holocaust' hysteria still would have been pumped up by the balance of zionist/international jewry that had wanted an israel) and also probably no bormann having secured 3rd reich war spoils and corporations in neutral countries veiled behind corporate shells.


3 April 2011

Dear Sirs,

A little 'late' after its original release, this weekend I saw the DVD of "Valkyrie", which I though was well done.

Your particular description of the mysterious, inner soul of some of Teuton Germany also was very well done and helped with some nuances that some movie viewers may not have understood about that movie, that period of time in Germany and Germans such as Schenk von Stauffenberg and that group with him.

My take away on the movie, and what occurred to me also after reading your 'review' of sorts below, was that the Nazis counterfeited that Teuton soul and attempted to exploit it. Hitler and those of his inner circle, Bormann, etc had no breeding, no Honor code like von Stauffenberg and the men with him in their strong desire to the death to bring about, and in their minds if not restore, but have the Germany that they thought they'd had or had wanted to have. That was not the international nazi/Fourth Reich that we see today. Notice there wasn't a Bormann among those men; none of the commercial sorts except for perhaps Fromm on the political side of the military were in the group with von Stauffenberg.

The differences between that of the 'Third Reich' which transitioned into the Fourth Reich and what we understood in "Valkyrie" are so dramatic that today we would not have the problems we do if von Stauffenberg and his group had been successful.

He was a man not bitten with a bastard spirit/curse of the bastard that is characteristic of the much of Germany and the Nazis - that lust/greed, 'fear', delusions, occult worship, and pathology that characterizes the Hitler, Himmler, Bormann that type and that clique that had commercial interests of some magnitude in Germany such as IG Farben, in the neutral countries and with the west - with the sorts like Rockefeller, duPont, IBM. Without the Fourth Reich, we would not have had and have the 'coldwar'/Global-War-on-'Terror', CIA, the NSA, the G20, the international problems, the 'terrorism', the disruptions in society, the inflate/collapse economic problems, the aggressive 'free' (nontariff'd) trade such as NAFTA, et al. On the minds and wallets of the voters, neo-feudal, International national/'corporate' socialism went on the road facilitated by the Reinhard Gelhand-SS/Gestapo-US Government/Rockefeller joint venture of the CIA/NSA and perhaps even the Mossad.

With Roosevelt who would have lived longer - they'd off'd Roosevelt - the Soviets and Stalin may not have had the Warsaw pact and those countries may not have been given for Soviet satellites, except by the time von Stauffenberg and his group were successful, the Germans already had lost in the long Russian winter and the Russians were looking for their pound of flesh/war spoil. The British may still have had their 'Crown' colonies.

There would not have been a '911'. Even the commercial sorts with Bormann, those knew that they were going to loose the war, but convincing delusional, demon minded Hitler and those around him was another matter. Again, our world, Europe, the US, the UK, the civilized west would be vastly different had there been success by von Stauffenberg and his effort to liberate Germany from the pathological thieves, bastards and bankers.

Please if you quote me and/or use what I've observed, please quote me. I am an established bank/financial sector analyst in the US. I have some profile on financial, economic-commercial and political matters.

In order to really understand what was happening in the US and with our commerce and economy, it was important to understand international agreements in which the US had some commitment and need to break. By the Grace of God, the G20 agreements and insights about them were brought across my path.

My colleague, Joan Veon ( ; "Prince Charles, The Sustainable Prince", "UN Global Straight Jacket" ) recently was passed away. She was what some would consider an expert on global government and the G20 agreements, however I am not certain what she understood about the Fourth Reich and the way the world is today by the influence of the Fourth Reich.


Andrea Psoras

Secret Germany

As Valkyrie, a new film about the plot to kill Hitler in 1944, is released, Justin Cartwright looks at the soldier at the centre of the coup and his vision for his country had it succeeded

Justin Cartwright /The Guardian, /Saturday 10 January 2009

In the film Valkyrie, Tom Cruise plays Colonel Claus Schenk von Stauffenberg, the man who, on 20 July 1944, placed a bomb next to Hitler in his east Prussian headquarters, the Wolf's Lair. The bomb failed to kill Hitler, merely blowing his trousers to ribbons. That night, when the coup was seen to have failed, Stauffenberg was shot in the courtyard of the army headquarters in Berlin on the orders of General Fromm, his superior, who was in on the plot and hoped - in vain - to save himself. Sandbags were piled in the courtyard and the lights of staff cars illuminated the victims. Von Haeften, his aide, threw himself in front of Stauffenberg. He and two others were also shot that night and their bodies quickly buried. Stauffenberg died with the words "Long live our sacred Germany" on his lips, or perhaps - some heard - "Long live our secret Germany". In German, there is even less difference between the words "sacred" and "secret" than there is in English.

Valkyrie Production year: 2008

Country: USA Cert (UK): 12A

Runtime: 120 mins Directors: Bryan Singer

Cast: Bill Nighy, Carice van Houten, Eddie Izzard, Kenneth Branagh, Stephen Fry, Terence Stamp, Thomas Kretschmann, Tom Cruise, Tom Wilkinson

The producers of Valkyrie have muffled his last words; the story behind secret Germany does not figure in their script, but they were clearly aware of its significance. Within a few weeks, 80 plotters had been executed in Plötzensee prison by slow strangulation, hung from meathooks; in all, at least 3,000 were killed and many children, including Stauffenberg's, were taken from their families and placed in orphanages.

Many of those executed were from Germany's most distinguished families, people who, like Stauffenberg, were appalled by the direction Germany had taken, both in relation to the Jews and to the disastrous war in the east. The film is true to most of the facts of the plot, but fails to convey any sense of the catastrophic moral and political vortex into which Germans were being drawn. Nor does it give much sense of the immense charisma of Stauffenberg, to whom generals and politicians deferred and who had for some time been tipped as a future chief of staff.

A revealing private memoir I was given, which describes a visit shortly before the bomb plot by Stauffenberg to one of the other resister's houses, suggests that the female staff were sent into paroxysms of adoration by the wounded hero.

And the film gives no indication at all of Stauffenberg's background and philosophy: he fitted perfectly into the German tradition of Dichter und Helden, poets and heroes. For a start, he looked the part, tall with classical features; he was often compared to a medieval statue of a knight in the cathedral at Bamberg, his home town, and his wedding in this cathedral in 1933 to Nina von Lerchenfeld was a huge social event. Even Hitler believed that Stauffenberg was the embodiment of a German hero. So when the generals failed in their plots against Hitler - there were as many as 15 of them - someone was needed to head the disparate but substantial resistance, which extended from the army into the Foreign Office, the secret services and to important clerics and trade unionists.

Stauffenberg was persuaded by his uncle, Nikolaus Graf von Üxküll, long disenchanted with the Nazis, that he should lead the movement. It seemed that he was the man who unmistakably wore the mantle of a near-mystic German past, a warrior Germany, a noble Germany, a poetic Germany, a Germany of myth and longing.

There is nothing in the script or in Cruise's performance that explores these particularly German preoccupations. At times Cruise looks and sounds like the troublesome cop who has been given a tricky assignment, with 24 hours to get the bad guy before he has to hand in his badge: the assassination attempt is treated as a thriller.

It lacks the intelligent understanding that Florian von Donnersmarck brought to The Lives of Others (2006), as people from different backgrounds, and with wildly different ideas of what Germany should become, tried to work together. Stauffenberg's stroke of genius was to subvert the emergency plan for defending Berlin against insurrection, Valkyrie, into a plan for a putsch after Hitler had been killed. As Hitler became more paranoid, it seemed that Stauffenberg was the only one who had both the access and the resolve to kill him. He was fully aware that the chances of success were slim, but he felt that he needed to demonstrate to the world that there was a better Germany - what he thought of as secret Germany - and perhaps that he was the agent of history.

When I was writing my book The Song Before it is Sung, about a conspirator in the bomb plot, I was puzzled for some time that the British refused to trust the various overtures from the resistance in Germany. Stauffenberg was a close friend and confidant of Adam von Trott, the Rhodes scholar who was also deeply involved in the resistance and executed a few weeks after the July plot.

I also pondered the question of why Trott's friend at Oxford, Isaiah Berlin, a magnanimous and generous man, came to distrust him, and I wondered why, 30 years later, he wrote in a letter to Shiela Grant Duff, who knew them both well, saying that Trott was no hero and "not on our side".

What he saw, I think, is that in ideas of a mythic German past, and in the belief in a historical destiny, lay the genesis of Nazism. The idea of a noble Germany, uncorrupted by racial inferiors and alien philosophies, a Germany that would be led by a world figure, was not invented by Hitler. Long before he came along, the simple word Führer - leader - had been turned into something messianic, and I think Berlin knew where the blame lay. During their walks and discussions in Oxford, Berlin often said to Trott that when he was at a loss, he turned to Hegel. Hegel believed, essentially, that history had a forward motion to a point where all contradictions would be resolved.

It is ironic that Stauffenberg's son should have been contemptuous of the notion of Tom Cruise playing his father, on the grounds that he is a cultist, because Claus Schenk von Stauffenberg and his two brothers, Berthold and Alexander, were themselves members of a cult that formed around a mythical secret Germany; their master was the poet Stefan George. George is a sinister figure, but in an American newspaper article of the 1920s he was rated one of the most important men in the world. Hardly remembered and little read today, he was a poet who rivalled Hölderlin and Schiller in his fame.

The Stauffenberg family had held the title of "Schenk", which meant "cup-bearer", since the 13th century, an honour bestowed on them by the Hohenstaufens, the legendary monarchical family of Swabia who also ruled Sicily in the middle ages. At the time of Stauffenberg's birth in 1907, his family was to be found at the Altes Schloss in Stuttgart, in the service of the Württemberg monarchy.

The Stauffenbergs were a family steeped in tradition, highly cultured, highly regarded. It was hardly surprising that Stefan George welcomed these good-looking and aristocratic brothers into his circle. This may in part have been because of the homoerotic element in his movement, but it was also because the Stauffenbergs represented everything George felt had been lost in Germany - the medieval greatness of the Hohenstaufen Friedrich II and the warrior qualities of the Teutonic Knights.

Poetry was to lead the way back to greatness, and George was Germany's poet; he and his disciples propagated the notion of a unique German-ness, Deutschtum, which was traced back to Friedrich II. Members of the George circle were subject to some bizarre rules. Only Claus von Stauffenberg kept his own name, presumably because of its flattering historical resonances. His brother Berthold was told not to marry the woman he loved, and he obeyed, at least until George was dead. But even after the war, the surviving brother, Alexander, eulogised George as the spokesman of something uniquely German.

Göring revered him too, and after the Nazi takeover of 1933 wanted to instate him as the head of an academy of poetry. George replied that he had for a long time been the leader of German poetry, and didn't need an academy. His circle had many Jewish members, but his views became broadly antisemitic as the Nazis became more important.

None the less, he fled to Switzerland and died before it was completely clear where he stood on national socialism. The Stauffenberg brothers were made George's heirs, and after his death tended his grave in Switzerland and continued to organise candlelit readings of his poetry. As the war progressed, Stauffenberg enjoyed a rapid rise in the army. He was at first enthusiastic about military successes on the eastern front, but had for some time been deeply alarmed by Hitler: Kristallnacht had disgusted him, particularly as his brother was married to someone of Jewish descent. He quickly became aware that the SS, the SD and the Gestapo were creating a lasting legacy of hatred that would one day be avenged.

He began to seek out like-minded officers and spoke at times quite openly about his fears for Germany and the army. Sometimes he recited George's poem "The Antichrist" to support his argument. As the advance east was halted, it became more urgent to end the war with at least something of Germany intact. Stauffenberg had particular cause for alarm: he was in charge of logistics for the 10th Panzers and knew that for every thousand casualties, only 300 replacements could be found - disaster was inevitable.

At the same time he found himself increasingly appalled by the indiscriminate killing of Jews, Slavs and Russian prisoners, and by the SS battalions' unbridled lust for murder, which was having a corrupting effect on the army too. He often ignored or changed orders: he managed to thwart an order that all Russian prisoners should be tattooed on their buttocks. After Stalingrad, his outspokenness caused some of his superiors to decide that he should be sent to north Africa, which was relatively free of the SS. There he was severely wounded, losing part of his right arm, one eye and two fingers on his left hand.

Through determination he made a dramatic recovery and found himself second in command of the home army in Berlin, under General Fromm, and was also appointed to the general staff, which gave him access to Hitler. After his first visit to the Berghof, he described the atmosphere there as "stale, paralysing, rotten and degenerate". A few months later, he primed the bomb with the three fingers of his left hand and placed it beside Hitler.

The question the film does not raise is what kind of Germany Stauffenberg envisaged had the coup succeeded, which in all probability it would have, had Hitler been killed. Stefan George's poem "Secret Germany" was the inspiration for Stauffenberg's oath of mutual intent for the conspirators, which was typed by his brother Berthold's secretary: We want a new order which makes all Germans responsible for the state and guarantees them law and justice; but we despise the lie that all are equal and we submit to rank ordained by nature. We want a people with roots in their native land, close to the powers of nature, finding happiness and contentment in the given environment, and overcoming, in freedom and pride, the base instincts of envy and jealousy. We want leaders who ... are in harmony with the divine powers and set an example to others by their noble spirit, discipline and sacrifice.

When Stauffenberg's body was burned, a ring was lost with it. Engraved on it were the words FINIS INITIUM, which is drawn from another of George's poems with the final line "I am the end and the beginning".

This wasn't the Germany that the allies had in mind.

• Valkyrie (12A) is released on 23 January

Saturday, October 23, 2010

No Barter in Revenue, especially for Finacial Companies!

Revenue Recognition:

Should the Revenue Recognition Model Include and Recognize Barter Transactions?

Andrea Psoras

May 16, 2004

BUS 221 Professor Alan Glazer

Revenue Recognition:

Should the Revenue Recognition Model Include and Recognize Barter Transactions?


Some 'publicly-owned' enterprises are pushing the financial reporting envelope too far by compromising relevant and reliable numbers for higher reported revenues (Kieso, et al. 2004, p. 901). They facilitate financial reporting compromise with the use of 'barter' transactions as a heterogeneous component of revenue. When the seller in a barter transaction has accepted a good or service in exchange for the good sold or service rendered (presuming rights of ownership going to the buyer), it has received an asset that fails the realized/realizable test for revenue. At this point, since adoption by the SEC on January 22, 2003, Regulation G prohibits the presentation of inaccurate or misleading non-GAAP financial measures (E&Y 8/03 p. 13, 16). Any method that reports barter transactions as part of revenue uses a (non-GAAP) method that misrepresents the true financial status demonstrated in GAAP compliant financial reporting of a publicly traded enterprise. Further, the stock exchanges require listed firms annually to report financial statements adhering to GAAP, which would prohibit the use and subsequent reporting of barter transactions as a component of revenue.

Moreover, with the Concept 6 definition of Revenue Recognition giving equal Income Statement treatment of the fair value of changes in Balance Sheet and contingent items, the Net Income number has become polluted with unrealized non-cash gains, while the discretionary power of agency to value their Balance Sheets arguing 'fair value' permissible under US GAAP, management at bigFinancial Institutions may use even inflation producing changes in their Balance Sheets and other contingencies such as OTC derivatives has the power to virtually 'print' money via their Income Statement revenue recognition of these non-cash (often unrealized) gains, beyond every one else in society which has to engage in transactions in order to enjoy remuneration and wealth development. The FASB has to some degree, 'anointed' agency at bigFinancials which are also the Interest and Swaps Dealers Association - the OTC derivatives trade association, to enjoy a new feudal status that the discretionary power of fair value gives to agency and its CPA and other advisors.

With many of these OTC derivatives activities including barter transactions where in the nature of their swap of one security for another many of these transactions fail to realize to cash, and with the sovereign governments - that is - the voters' wallet being the ultimate backstop in all ISDA agreements, agency can write any sort of derivative contract, value it at virtually any value justifiable, while the voter is the new serf in this wealth transfer the crippled financial reporting model facilitates and contributed to giving us the financial 'crisis' and financial system 'collapse' while agency at the bigFinancials enjoyed compensation beyond what most people even in developed world would ever see over the life time of their work and investments.

A Description of Purpose

This paper describes issuers’ practices, methods, and flaws of the use of and recording for barter revenue vs. non barter revenue transactions and considers whether barter should be recognized as revenue. The author compares barter vs. non-barter transactions as a revenue component and whether barter satisfies the tests for GAAP revenue recognition of having been earned and realized/realizable to cash and claims to cash.

An Introduction of Revenue Recognition with Respect to Barter Transactions

Should the revenue recognition model permit the use of barter transactions - that is, non cash or equivalents exchanged between buyer and seller for goods sold or services rendered to a counterparty (Sondhi 2004)? Keeping in mind how the financial reporting model’s underlying theme of companies operating as a ‘going concern’ predicates the assumption of management’s “good faith” conduct, When companies recognize revenue, they assert that a transaction actually occurred, and was recorded on a timely basis at the proper amount. A revenue transaction occurs when a company transfers goods or services to a customer, the earnings process has been substantially completed, and the likelihood of collection (realizability of cash and claims to cash) is reasonably assured (Sondhi 3/1/04; Kieso, et al. 2004).

When reporting barter transactions as revenue, however, management ignores important economic and public reporting concepts for publicly traded enterprises. As the word barter means to cheat (American Heritage Dictionary 1981), there is no coincidence the definition foreshadowed the recent spate of flawed reporting practices, including the recognition of barter transactions as a component of revenue. In the late 1990’s in one quarter, experts estimated that barter transactions summed to greater than 10% of revenues of all internet companies (Kieso, et al. 2004, p.901). Managements of many of those companies, although operating in a sophisticated commercial environment, reported barter as a component in revenue, and thereby contributed to the pervasive erosion in reporting quality. Concerns in the late 1990s became greater at the SEC when many ‘new economy’ (specifically internet companies, AOL among, them), included barter transactions in their reported revenue, but infrequently reported positive earnings figures (Computer Wire News 2002).

Revenue was becoming the accounting figure that some investors were using to value these companies. When revenues include barter transactions, this creates distortion and a misrepresentation, while eroding comparability among (peers and) other publicly traded companies. (The SEC expressed concern over the distorted revenue figures and lack of comparability with the valuation (albeit, equally flawed) practice based on earnings.) The Chief Accountant expressed concern about the portion of revenues coming from barter transactions such as advertising exchanges with similar companies. He wanted to make certain that the information issuers reported to investors reflected a true, reliable picture of what is really occurring with revenues, and that those numbers are reliable, while eliminating the distorted financial misrepresentations management was making in general, and in the internet industry in particular (Kieso, et al.2004, p.901 citing Wyatt; MacDonald 1999).

Other market participants, meanwhile, such as the issuer community and Congress, had made the financial reporting model and the FASB convenient whipping boys for the failures of agency, administrative regulation, and political interests. With regulators eventually began focusing on revenue reporting in a number of sectors, that encouraged the FASB take Revenue Recognition as a project (Kieso, et al. 2004, p.901).

The development (referring to FASB’s project) comes on the heels of a push by the Securities and Exchange Commission to crack down on what it sees as an explosion of transactions that falsely created the impression of booming business (as indicated in revenues), from energy and telecommunications, to Internet companies and retailers... illusory "swap" trades that boosted their apparent business... so-called fiber-optics swaps at telecommunications companies such as Global Crossing Ltd. and Qwest Communications International Inc. that boosted their revenue. Regulators are also scrutinizing other types of "round-trip" transactions, including some barter deals and vendor-financing arrangements that may have boosted revenue but lacked economic substance (Pulliam 2002).

With respect to revenue recognition, compared to derivative accounting, says Patricia McConnell, an analyst at Bear Stearns, "there isn't any single standard for revenue" (Pulliam 2002).

A Discussion of Methods/Types of Barter and Non Cash verses Non-Barter Transactions Recognized in Revenue

Managements of publicly traded enterprises practicing most cash or non-cash exchanges as a part of the business model account for their financial performance via public representations. In the GAAP accrual accounting model, the enterprise’s revenue should match associated expenses incurred while producing its goods or rendering its services. The measurement and tests (realized-realizable and earned) for recognition of associated revenue earned must represent that the enterprise has sufficient or insufficient means to satisfy expenses and other liabilities it incurred. When (and if) the earnings process is complete, monetary and non-monetary transactions are recorded at the fair value of the products delivered or services received, whichever is more readily determined (Sondhi 2004).

Further, rules exist that enable companies to determine whether barter transactions are monetary or non-monetary transactions (FASB, EITF No. 01-02). When the cash exchanged represents more than 25% of the fair value of those exchanges, such must be treated as monetary transactions (Sondhi 2004; FASB, EITF No. 01-02). In addition, “a FASB panel has ruled that firms may report barters as part of their revenue providing they have a history of receiving cash for similar [in this case, advertising] transactions” (Bitner 2002).

Fair value of a non-monetary asset transferred to or from an enterprise in a non-monetary transaction should be determined by referring to estimated realizable values in cash transactions of the same or similar assets, quoted market prices, independent appraisals, estimated fair values of assets or services received in exchange, and other available evidence. If one of the parties in a non-monetary transaction could have elected to receive cash instead of the non-monetary asset, the amount of cash that could have been received may be evidence of the fair value of the non-monetary assets exchanged, assuming rights of ownership have passed to the buyer (APB Opinion No. 29).

How and what sorts of other barter (sic) transactions have users reported?

Some, often qualified as ‘tech’, sectors using non-monetary transactions similarly are attempting to use barter in their revenue recognition. (when asking what resulted from their experiment with ad hoc accounting, with respect to barter transactions included in revenue?) Exchanging of goods or services for in-kind or similar ‘assets’ with a counterparty and recording the exchange as revenue became more common with the advent of the ‘new economy’ and the popularity and public ownership of “dot coms” ( i.e., internet enterprises). Barter transactions or “round-trip” of cash in barter-type transactions came into vogue, which the SEC began scrutinizing. Round-trip transactions are similar to barter transactions except that in a "round trip" transaction, one company sells a product for cash to another company, which in turn sells an equivalent product back to the initial seller for a similar price, with each company recognizing revenue on its "sale" it is attempting to claim (Petri 2002). Many internet companies exchanged advertising space with each other, where an equal amount of revenue and expense was reported, without any effect on cash flow and net income. The ‘swapping’ in time included more than merely ad space. Major telecom companies began swapping fiber optic capacity as a way to make an argument for reporting higher revenues (Radigan 2002).

Other relevant works have arisen from AICPA - SOP, FASB - EITF; SEC - SAB, IASB, and ASB. Asearch through the FASB material about barter transactions in revenue produces “Accounting for Barter Transactions Involving Barter Credits” (FASB. EITF No. 93-11), where one has to read carefully to find the prose associated with revenue: “The issue is whether Opinion 29 (APB Opinion No. 29), should be applied to an exchange of a non-monetary asset for barter credits and, if so, the amount of profit or loss, if any, that should be recognized ” (FASB, EITF Issue No. 93-11). Other authoritative work advising on exchanges that fail revenue tests state that gains are recorded at the carrying amount of products delivered, which is generally zero (APB 29 -Other Non-Monetary Transactions; FASB Statement No. 63; FASB, EITF No. 99-17; FASB, EITF No. 01-02; Sondhi 2004).

Analysis of Sorts and Methods of Non Barter vs. Barter in Revenue

Importance of Adherence to the Conceptual Framework For Revenue Recognition

The subjectivity of what occurs between parties exchanging goods and services in a barter transaction somewhat erodes comparability with past periods as well as comparability with peers, assuming peers are generating realizable revenue. Further, some notion seems to exist that the financial reporting model must compensate for what appears to be vestiges of inferior commercial practices from earlier economic paradigms (Psoras 2004).

Aside from the ordinary tests for recognizing revenue - such as whether the earnings cycle is completed, and is a nearly closed contract considered earned - without some other bright line test, self-dealing, ambitious management can use barter transactions as a component of revenue (FASB, Concepts Statement No.5, paras.83,84; Concepts Statement No.6, paras. 29, 32, 33) to inflate revenues. As the public reporting model assumes good-faith’ in management and financial reporting practices, the perceived lack of ‘rules’ in revenue recognition and reporting tempts management misrepresentation or even deceit or fraud, and gives rise to strong accusations about ambiguities in the current definition of the components of earned revenue. In general, the “FASB has ruled that firms “may report barters as part of their revenue, provided they have a history of receiving cash for similar (in this case, advertising) transactions”. This less-than-airtight rule provides the kind of gray zones these firms need to maintain their illusions” (Bitner 2002), the FASB had neglected requiring the tests for revenue with barter transactions in advertising, in this case.

Arguably, questions will arise regardless of the integrity of management - for example, is ‘fair value’ less subjective or more subjective? Fair value should be established by reference to the recent history of cash sales of the same products or services in similar sized transactions (Sondhi 2004). How quickly can revenues be recognized? Is delivery the date of sale? Even after providing services, do the customers need to be billed to demonstrate ‘earned’ for recognition purposes? Recognizing other benefits for use of enterprise resources as time passes or as assets are used in an arms’-length transactions - is revenue recognized at the sale of any other assets other than those produced as goods for sale (Kieso 2004, p. 904)? Has management effectively priced its goods produced or services rendered assuming ‘right of ownership’ has passed to the buyer, meanwhile accepting an exchange of anything less than cash or claims to cash? Perhaps management is accepting non-cash assets from counterparties in arms’- length transactions for those goods or services, then recognizing those assets in revenue?

Meanwhile, what cash and related resources has the enterprise used to pay its obligations? Investors, creditors, and counterparties must question the ‘going concern’ status of an enterprise when, for example, when the firm used stock sales as a virtual operating method to raise cash to fund its ordinary obligations, partly because the firm’s use of barter transactions as attempts to generate revenue failed to realize into sufficient cash to operate the enterprise. In conjunction with sales, methods of marketing products and services were said to make it difficult to develop guidelines for recognizing revenue in all situations.

With respect to many of these questions, management failed to properly use the GAAP revenue recognition concept where realized/realizable into cash and earned are the tests for revenue recognition. The notion that difficulty existed when determining revenue recognition in ‘new industries’ arose, and meanwhile became worse when management also opposed ethically answering when and how they should recognize revenue. In turn, management put pressure on their accountants to waffle when answering the question (Radigan 2002).

Analysis of Sorts of Barter and Non-cash Transactions. With Respect to the Conceptual Framework

One could say barter transactions as components of revenue fail to meet GAAP standards for realizability, sufficient completion of the earnings process, comparability, and representational faithfulness. In addition, generally the value of what the buyer offers the seller has been the amount recognized by the seller, presuming an arms’ length transaction, which leaves a host of problems with respect to optimizing the firm’s value given its ordinary operating constraints.

The staff (SEC) believes that revenue generally is realized or realizable and earned when all of the following criteria are met: persuasive evidence of an arrangement exists; delivery has occurred or services have been rendered, the seller's price to the buyer is fixed or determinable, and collectability is reasonably assured.... In the absence of authoritative literature addressing a specific arrangement or a specific industry, the staff will consider the existing authoritative accounting standards as well as the broad revenue recognition criteria specified in the FASB's conceptual framework that contain basic guidelines for revenue recognition (SAB No. 101, A.1).

These SEC guidelines fail to demand clearly defined realizability of measurable revenues, mentioning little about barter, later adding,

Because revenue recognition generally involves some level of judgment, the staff believes that a registrant should always disclose its revenue recognition policy. If a company has different policies for different types of revenue transactions, including barter sales, the policy for each material type of transaction should be disclosed... (SAB No. 101, A.1).

The Commission has omitted discussing barter as a part of ‘revenue’, and how barter violates the realizability test, while barter can seem to satisfy the other criteria the SEC confirmed from SOP 97-2, which coincidentally also is used in “Accounting by Producers or Distributors of Films”, SOP 00-02, as well as to many other contexts. It again gives appearance of some delicate dance around defining revenue, the recognition of components of it, and how barter may or may not be included as a component recognized in GAAP revenue.

The use of barter as a means of commercial, counterparty exchange adds a subsequent, poorly and subjectively measured component to revenue recognition for the enterprise. As a method to receive an asset exchange for a good sold or service rendered, and thus for the seller to include barter as revenue, barter fails the realizability test. Some experts seem to respect the use of barter in revenue, however, and are interested in whether the recognized value of products or services should be fair value, book value, carrying value, or using any of those values as the cost basis of the goods or services received in exchange (Sondhi 2004). The realizability matter remains open and unresolved even where (a monetary transaction exists when) the cash in the exchange represents 25% or more of the fair value of those exchanges (FASB, EITF No.01-02, “Interpretation of APB No. 29”; Sondhi 2004). Under Opinion No. 29, the gain fails to count as a revenue component when the amount realized is less than full value of the asset sold or given up to the buyer. Moreover, APB Opinion No. 29, as well as its ‘Interpretation’, avoid the complex issue of inclusion or consideration of a barter as a component of revenue, even though the authoritative material attempts to resolve the issue over selecting the fair value most readily determinable for either the assets received or relinquished (FASB, EIFT No. 01-02). Has management engaged in a fair transaction? Has management developed a transaction where the true value of all the assets in the transaction summed to less than fair value for the goods sold or services rendered? Again, that concern gives rise to questioning management competence, professionalism, business judgment, and duty of ‘care’ to the shareholders (Mallor, et al.2001, p.909, 910).

How have other barter users reported their transactions? What resulted from their experiment with ad hoc accounting? Other ‘swapsters’ have included companies exchanging software, databases, broad-band capacity, and fuel in addition to many other goods and services. These included in revenue items go far beyond ‘ad’ exchanges between internet companies (Sondhi 2004; IOMA 2003). There is no overall effect on net income or cash flows, although the timing of the revenue and expense may differ. Although this issue often is discussed in the context of internet companies, it also applies to advertising barter transactions in other industries. As an epitaph , “such barter transactions got tossed out when many content sites lacking in cash went out of business, and the surviving ones had to grow up and find real sources of revenue” (Orr 2002; Lawler 2000). Meanwhile, the AICPA’s “Software Revenue Recognition” added 4 other revenue tests (AICPA, Statement of Position-97, para. 2).

“The SEC has also found that many internet companies wrongfully book revenue for barter transactions in which they exchange advertising with another internet Company” (Auerback 1999). Some dotcoms also boost their revenue by bartering advertising with other web-based firms (Stewart, McLaughlin 2001). “Aggressive accounting treatment of sales is now spreading beyond internet companies” (Auerback 1999). Lucent Technology “used a variety of accounting gimmicks in order to produce a "blow-out" fourth quarter. On the surface, the period was marked by a strong increase in "sales". However, such sales are produced in a rather circular manner, where it engages to a significant degree in the practice of taking an ownership position in such companies, then lending money to the start-up to enable the latter to buy their equipment” (Auerback 1999).

Perhaps related to lack of a real sales transaction with realizable revenues, the SEC “ruled invalid telecom wire access rights exchanged between telecoms, whose managers had used the de facto wash exchanges to boost their revenues, even though the telecoms had purchased and sold the access to their networks with one another” (Radigan 2002). The SEC also voided the round-trip sales that had been recognized as separate transactions. Further, the seller recognized the sale immediately while capitalizing the ‘expense’ and amortizing the cost of purchased access on another network over the life of the ‘deal’, sometimes the time spanning more than 25 years. Again, the SEC appeared reluctant to draw a line on failures of corporate good faith and in business judgment practices with regard to circular exchanges for wire access, while management attempted to portray these round trip ‘sales’ as legitimate sales, even though no valid business reason existed for these round trip maneuvers other than to misrepresent revenues (Radigan 2002). Management felt pressed to find new sources of revenue and used this ploy. The SEC ruled many of these transactions as “round-trip”, and as a result, prohibited the barter transactions from affecting the revenue of those firms.

Television and Broadcast (and eventually, so as to justify for GAAP purposes their barter exchanges, the dotcoms) referred to “Financial Reporting by Broadcasters” (FASB Statement No. 63), as well as at one time looking to “Revenue Recognition by Television ‘Barter’ Syndicators” (FASB, EITF No. 87-10), and “Accounting for Advertising Barter Transactions” (FASB, EITF No. 99-17), with the dotcoms’ exchanges never having realized revenue (FASB Statement No. 63, paras. 8, 14), although the FASB (Statement No. 139) amends it by adding broadcast is subject to “Accounting by Producers or Distributors of Films” (AICPA, Statement of Position-2, para. 21), which indicates “An entity sometimes licenses programming to television stations in exchange for a specified amount of advertising time on those stations. Although these transactions qualify as non-monetary exchanges, according to GAAP revenue, technically one precludes these transactions from revenue (APB No. 29; as interpreted by "Accounting for Barter Transactions Involving Barter Credits", FASB, EITF Issue No. 93-11; FASB Statement No. 139; FASB Statement No. 53).

Utility, power, and broadband barter and round trip transactions often involved counterparties in the same line of business. Two companies swapped the same commodity in these situations, with each company recognizing revenue from the exchange, even though little of economic substance actually had transpired. A company intent on disguising barter transactions or "round tripping" may try to do so by running the transactions through an intermediary rather than dealing directly with the ultimate counterparty. “For example, if two companies agree to buy each other’s products, exchange invoices and checks, the question is, are these transactions really substantive, and should they be recorded at the full invoiced value?” (Petri 2002), in substance which fails the realized-realizable test.

Barter transactions in Revenue Introduce Other Operating Problems

With the inclusion of barter transactions as part of revenue, management is carelessly and imprudently considering introducing a cash deficit in the revenue recognition cycle as well as eroding financial reporting quality. Barter also promotes a management notion that it can engage in commerce while ineffectively pricing, and in turn charging, for the goods and services it renders, meanwhile disserving its stakeholders and non management shareholders. Barter also promotes the notion that management can avoid establishing optimal pricing for its goods and services, yet engaging in a commercial environment that functions on a unit of exchange for the money of account concept. Our ‘money of account’ is the US Federal Reserve Note, also known as cash. Management and employees of firms using barter as a means of exchange are interested to enjoy the fruits that their 'work' ordinarily would produce, however, with barter failing to complete the revenue cycle, they now have operations needing liquidity, yet lacking the necessary cash typically produced from revenues realized when earned test (FASB, Concepts Statement No.6, para.29). All stakeholders except senior management of such enterprises are finding disjointing, the flawed pricing and costing practices of their businesses conflicting with their needs to participate in society in the meaningful way they desire (Concepts Statement No. 6, para. 29).

Where some managements were selling company stock in a rising market to raise cash for ordinary operating expenses, however, representing itself as, and reporting to be a going concern, we saw management and commercial failure-bankruptcy when many of these firms’ main operations produced insufficient cash and a greater proportion of its realized and realizable revenues. Any strategy using the firm’s stock sales to raise liquidity to satisfy its operating obligations violates the going concern principle and could be judged as to be a signal of management liquidating into virtual and often actual bankruptcy. “E”-businesses had displayed many of the factors that gave rise to these going-concern issues. They had proven highly sensitive to general economic downturn and decreases in consumer confidence. Consideration of their cash generating abilities on one side and cash needs on the other should have alerted auditors as to whether they would need additional sums of cash in the first 2 years to continue operating (Tackney, Day 2002).

Foreign GAAP on Barter Transactions In Revenue

The UK’s IASB model for revenue does not assume realizability, i.e., cash and claims on cash: “... whether the revenue from the sale is collectible and measurable” (IAS18.14-19; PricewaterhouseCoopers 2002). Tthis is what they indicate, however:

The general principle of revenue recognition under UK GAAP is that can't recognize revenue unless you have an asset as a result of a transaction or, at least, a smaller liability to show for it. Under the Urgent Issues Taskforce Ruling, dot com ad barters transaction couldn't be recognized as increasing a company's sales unless it could have been made for cash (Williams, CA 2003).

Notwithstanding, the ASB definition omits the realizability test for revenue produced from the exchange of goods and services. Unless FASB and other domestic participants in the US reporting system, and the other participants on the international level in IASB promulgation and require demonstration “conclusively that the deal was a genuine cash transaction and not an artificial stitch-up" (Stewart, McLaughlin 2001), issuers may, and perhaps will use barter and report heterogeneous items in revenues, where not all of those items realize the money of account (FASB Concept Statement No. 5). Apparently, the British reporting model would permit barter in revenue under the following framework: a transaction (barter or otherwise) should give rise to revenue if, on its completion, the entity has been rewarded for eliminating the risks previously outstanding in the relevant operating cycle (Barden 2001) which appears somewhat to fail a conservative definition for the matching principle.

Other Factors Related to Barter Transactions in Revenue

Even the accounting model calls for transactions to be completed in our money of account: “Prices and labor savings do not exist without a monetary unit of account that is necessary to promote exchange” (Sontheimer 1972). Cashless societies and primitive economies are dysfunctional (Sontheimer 1972 -Introduction) partly because barter violates liberty (typically enjoyed in an arms’ length exchange with the money of account as the operative medium of exchange) from a counter party in a fair exchange using the money/unit of account for goods and services (Psoras). With this in mind, failing to close the revenue cycle, then making representations otherwise about the viability of the publicly traded enterprise, is a ponzi scheme to the non-management shareholders and the market in general. Further, in times of crisis or when management needs cash flows to expand operations and activities, the prolific use of barter transactions has interfered with, and deteriorated the necessary cash flow and wealth development that builds important reserves and pools of capital for progress. Even in business combinations where buyers are interested to full value for their purchase, experts have been questioning targets’ revenues and recognition practices (Basile 2000). For example, Enron’s activities failed to produce sufficient cash to extinguish its claims and obligations, in part because it used its common stock as collateral for some of those activities. When stock sales failed to provide sufficient resources for its obligations, it skuppered its operations and colluding with its bankers, crafted a bankruptcy (Psoras 2002).

Ineffective boards’ of directors and audit committee oversight seemed to feed the inflated revenue problems. The lack of independent expertise is troublesome not merely for fear that the new rules will not be met but also for providing meaningful board oversight on thorny new questions ...such as how to handle emerging revenue-recognition issues like barter transactions” (Elkind 2000). Further, management and the other self interested parties, players such as the VC and PE firms, and investment banks, which invest in enterprises with insufficient revenue and sometimes flawed revenue models, began pressuring the revenue model. With the pervasive flaws erupting in reported revenue, the FASB commenced its revenue recognition project. Meanwhile, the group of players merely want a legitimize Enron-esque business practices at the expense of the reporting model. And with this, SROs are permitting grand scale fraud to let these public reporting miscreants have access to the equity markets.

If the enterprise is selling stock to produce cash to operate the company, while failing to produce sufficient cash from operations, management is at risk with the market direction to help meet its obligations. Among other prudence this violates, included are themes of transparency, although the cash flow statement reveals most origins of cash. Likewise, other appropriate items under GAAP, in good faith as a going concern management reports to counterparties and stake holders including other claimants, not only absentee owners who are risk takers. These other claimants would be subject to their own shareholder lawsuits if engaging in commercial activity with such a noncredit worthy and unstable counterparty, and would be obliged to do business on a cash basis. While revenue is generally recognized when service is rendered or merchandise is shipped, various problems may cast doubt on the economic substance of the transaction (Martin 2002). So inflated revenues can be related to management misdeeds, and not necessarily to weakness in revenue recognition and the GAAP reporting and model.

As the markets are gamed by large institutions, investment banks, and senior management insiders, this triangle is pirating from and defrauding ordinary shareholders and employees who ignorantly invested in these poorly conceived and poorly run enterprises. Bowen, Davis, and Rajgopal examined “factors hypothesized to influence the reporting of advertising barter revenue and grossed-up sales levels. Their study found that firms with greater cash burn rates and higher levels of activity ... (which were chatted up on message boards were) consistently associated with barter and grossed-up revenue reporting. This suggests that the pressure to seek external funding and the extent of active individual investor interest in a firm influence Internet managers' use of allegedly aggressive revenue-reporting practices” (2002).

Opinions of Other Experts

Some experts seemed reluctant to take a strong stance against including barter in revenues, perhaps because they are self-interested. What follows includes some opinions of some experts’ published and knowledgeable in the matter.

Dr. A. C. Sondhi seems to have given it a pass, as he avoids answering the realizability failure of barter recognized in revenue (Sondhi 3/1/04). DeMark and Dell’Area similarly avoid addressing the realizability aspect. In this quotation, comment about the advent of the internet and its effect on commerce. They omit or avoid indicating the internet barter revenue failed to realize cash, and they omit explaining why barter involving internet companies exists uniquely among other enterprises that have used some sort of barter, although not for revenue in the way the internet companies had used.

The Internet has also wrought changes in the practice of barter transactions, the exchange of goods or services instead of cash between companies. ...That guidance, however, does not always hold when applied to Internet-based barter transactions. Internet companies have embraced web-based advertising, accounting for $8 to $10 billion of activity. Barter accounts for an estimated 5% of this total revenue. The exchange of advertising is especially appealing to startups because the company receives the services without a cash outlay, and the barter arrangement may allow companies to utilize excess Internet capacity while receiving some benefit in return (DeMark, Dell’Area 6/1/02, p.56).

Barden, a member of the U.K.’s Accounting Standards Board likewise appears to permit including barter in revenue recognition, but again avoids or omits addressing the realizability test (Barden 9/30/01). Moreover, the weakness in the language of the SEC’s SAB No. 101 puts at risk maintaining any substantive definition of revenue recognition unless the Commission confirms that revenues must be realized, that is, result in money or claimes to it to the ‘seller’.

CONCLUSION - History and -we hope not - Prologue?

Merely because an arm can be attached surgically to where a leg once had been, that should not be done. Similarly just because the barter exchange can be done, this is not adequate justification for including it as a component of revenue. Affirmation of the realizability test is missing for barter transactions, however, although realized-realizable into cash and claims to cash is a key test for any transaction that is presumed recognizable for revenue, while all enterprises may report only realized-realizable and earned items as revenue according to GAAP.

Moreover, regulation and legislation may have ended the ‘debate’. At the present time, barter transactions included in revenue fail to conform technically to criteria required for GAAP revenue. It is now is prohibited from being included in the reporting model for publicly traded companies following, the SEC’s adoption of Regulation G (1/22/03). This regulation explicitly prohibits the presentation of inaccurate or misleading non-GAAP financial measures, and the passing of the Sarbanes-Oxley Act 2002, where its Section 906 requires management certification of periodic reports that “fairly present the financial conditions and operating results of the issuer”, meanwhile complying with GAAP (Ernst & Young 8/03, pp. 13, 16). As the inclusion of barter fails to meet the Concept definition of realized/realizable, and earned revenue, such remains outside of GAAP.

The FASB added Revenue Recognition as a project partly to accommodate player demands. It is repairing the 'revenue recognition' model’s ambiguities that acted as holes through which management exercised poor business judgment and, self-dealing; and ad hoc contract practices proliferated, which were imprudently approved by the accountants and ignored or overlooked by the investment community (Mallor, et al 2001, p. 909, 910). FASB is attempting to remedy agency failures elsewhere in the corporate model that had the appearance of reporting failures, failures blamed on the reporting and revenue recognition model (FASB 3/24/04. Project Updates: Revenue Recognition, The Board at this meeting made no mention about gains, so one could assume gains remain subject to the realizability tests.). No proposed changes in the FASB’s criteria for revenue recognition related to realized or realizable -- assets received must be readily convertible to known amounts of cash or claims to cash (FASB Concepts Statement No.3, para.83). Without a bright line test for recognizing revenue only when the cash or claims to cash are realized and earned, there seems to be no way to avoid what Adam Smith and many others have described as the problems of agency, where management has a tendency to act in a self-dealing way. As a result of stimulated corporate access to the public equity markets, the age-old problem of management failures of good faith and ‘clean-handed’ business judgment now appear to be proliferating at the expense of the reporting model, with heightened attention on the top line, i.e., revenue recognition.

The proper accounting for exchanges of non-monetary assets is controversial (Kieso, et al 2004. p. 482). Current GAAP prohibits exchanges for similar productive assets to be considered as revenue or gain unless completion of the earnings process has occurred. Per a gain, it should not be recognized because the good or service could have been sold presumably at fair value, although a loss should be recognized immediately, although the current prevailing practice deems exchanges between dissimilar products at ‘fair value’ has completed the earnings process (APB Opinion No. 29; Sondhi, 2004), assuming fair value is easily determinable. Perhaps immediate recognition of gains on the exchange of dissimilar assets relates to notions of a fair transaction, whereas exchanges of similar assets leads to questions about the business purpose embodied in arm’s length transactions (APB No. 29; Kieso 2004. p.482). In the event that the transaction includes monetary consideration, also known as ‘boot’, a portion of the earnings process is assumed to be completed and a partial gain is recognized, based on the amount of the ‘boot’ (Kieso 2004. p.483).

Strong reasons exist for rejecting permissibility of barter transactions as revenue. This paper argues that barter is a poorly measurable, imprudently and carelessly considered management practice that can produce deterioration in the revenue generating cycle. If a seller accepted bartered goods or services and reported this as revenue because it wants to use assets to exchange for a future good or service, receiving payment in anything else similar in fair value other than what is realizable in the money of account and claims to it, the circumstances of the barter exchange breach the earnings cycle for the unforeseeable future. Based on that, barter transactions have failed the revenue test, while also perhaps failing the arms length, arms’ length, fair value assumption on which the public reporting model is based.

The use of and reporting barter transactions as revenue promotes a management notion that it can engage in commerce while ineffectively pricing and, in turn, charging others for the goods and services it provides, meanwhile disserving its stakeholders and non management shareholders. Including barter in revenue further promotes the notion that management can avoid establishing optimal pricing for its goods and services, yet desiring to engage in a commercial environment that functions on cash and readily exchangeable equivalents.

Including barter transactions in revenue fails to complete the revenue cycle with respect to realized-realizable. It is inferior for measurement purposes and fails to produce cash on which the company and employees rely for operating activity and remuneration purposes. Employees, nonmanagement shareholders, and stakeholders of such enterprises are finding that the flawed pricing and costing practices of businesses do not contribute to society in the meaningful way the stakeholders desire. The result becomes a progressive moral hazard, with associated market scams that enrich a few insiders, while fleecing the ordinary investor and the less powerful stakeholders.

When barter reporting issuers participate in the equity markets, as under the deceit of ‘new economy’ companies, their shares tend to attract (pirate) market ownership at the expense of other listed issuers and investors who own shares in more substantial companies that have been harmed partly resulting from the ‘new economy’ propaganda. NASD, NYSE, and the other organized exchanges should not list companies that attempt to sustain themselves by using market liquidity schemes. Such practices should provide a red flag to regulators. To attempt to erode the reporting model, however, so as to give the appearance that such companies are earning sufficient revenue to sustain their operations is a larceny to the ordinary investor, as well as a commercial failure. When virtually the entire dotcom sector practiced barter, the deceit rises to the level of a grand scale fraud to satisfy the self-dealing and self- enrichment interests of a few managements; private equity and venture capital investors, and investment bankers who are looking to cash out in a ‘take-the-money-and-run’, pump-and-dump scheme.

Financial statements under the barter scenario are too subjective for comparison and leaving the company shareholder lawsuits. Use of such practices, and expecting the reporting model to contort accordingly, also presumes that the market is either efficient and the share price of a barter user accurately reflects the company’s worth, or inefficient -- to give them an advantage -- with the latter being more true as market players during the bubble bought anything whether or not management reported GAAP and the stock buyer knew that. Management practicing barter as part of its revenue model assumed the markets were inefficient and opaque because in disingenuously reporting its status, it felt the ‘investor’ would think more highly of their stock and buy it. Meanwhile, there was no logic to most equity buying during the Bubble; management could have reported anything and people still would have bought (shares).

The FASB should end the debate with an effective definition for revenue recognition that excludes from the reporting model barter transactions as components in revenue. Users of accounting statements are looking at far more craven frauds within accrual accounting, where the reporting model itself deceives the user on the true status of the publicly traded enterprise, similar to the dotcoms and Enron using common shares sales to generate cash flow for operating, and as collateral for off-balance sheet activity practiced during, and simultaneously producing the bubble.

As a result, we should reject the use of barter in the revenue recognition model and keep high the 'bar' (that is, the quality of revenue and the recognition and quality of financial reporting). Any method used to report barter revenue permits a lowering of the reporting bar. Inclusion of barter gains in the reporting model might be possible, perhaps in a valuation account in Shareholders’ Equity, in the event there is an increase or decrease in the amount received for the goods sold or services provided by the seller.


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