The Miller and Bahnson article "Duh-preciation: Why is this elephant still in the room?" (Accounting Today, Dec. 13-Jan. 10, 2011, page 17) is a great example of the damage sitting in an ivory tower without anything useful to do but play with your ankus does to one's brain cells.

After all that long and expensive education, still being so confused about basic accounting theory is a terrible waste of good money. You owe your parents a refund. It is time to get back to some of your entry-level introductory accounting texts and refresh your memory about what "depreciation" is.

It is not a terribly difficult concept, and with some effort I think you may have that wonderful "Aha!" moment. You will be shocked to find that it has absolutely nothing whatsoever to do with "valuation." I would also suggest reading some primers on how to determine market value (hint: "insured values" and "databases and recent transactions" are not, I repeat, not the answer).

I also suggest that you stop prodding each other with your ankus before the damage becomes irreversible, if it is not already. Gentlemen, your article is a travesty.

Gus van Driel, CPA

Via e-mail


Miller and Bahnson respond:


Dear Mr. van Driel:

We received your comment, and thank you for sending it. We're always pleased to know that people read and react to our thoughts, even if they don't concur.

Although your letter is less than completely civil and somewhat sarcastic, we find that it displays exactly the result that we anticipated would occur among those who continue to practice financial accounting as they always have, without stopping to consider whether the output meets the needs of those who use the information, or would use it, if it were to actually be useful for helping them make rational and well-informed decisions. In contrast to your emotional defense of a nearly two-centuries-old status quo, others have acknowledged that the column makes a great deal of sense and sets a positive direction for future progress.

In addition to the advanced age of systematic depreciation, it continues to amaze us to find that so many of today's practitioners are still using matching as a justifying principle, when the Financial Accounting Standards Board so resoundingly repudiated it more than 30 years ago. With that said, we know that it must be frustrating to find practice evolving in a direction that you don't like.

In your case, it appears from your ad hominem attacks that we will agree to disagree without being disagreeable.

Paul and Paul

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