Fuzzy Math at Citigroup and Bank of America

Hat trick accounting

It's a bit distressing to see a large part of the financial reporting community and most bank analysts simply repeating the mantra of C and BoA regarding their Q1 results.

It has only been in the past two days where FINALLY some are questioning the numbers and getting under the hood of the reported results.

However, the public relations stunt put on by C drove the market and C common WAY BEYOND its fundamentals. It comes close to stock price maipulation.

HOW CAN THE BOARD, THE COE, CFO and whoever else, sign-off on such a P&L ? Sure, it's legal due to a recent FASB scheme,but to claim a gain/credit for a REAL loss incurred in prior years, that's really threading the needle.

Besides this smoke and mirrors approach to quarterly reporting, there is still $2.5 T!!! of serious questions on and off the balance sheet of C. There is nary a word about those assets and instraments. Does C management think just because they put it in their "bad bank" category we shold just forget about it?

I am afraid that as long as the Pandit/Parsons regime is in charge, and the Board remains in a coma, C is doomed to be a mediocre bank both in terms of its share price and corporate ethics.

al of NY @ Apr 20, 2009 15:49:39 PM