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The change of accounting treatment for options pushed their financial impact to the profit line of the company.
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During the meeting, Hulse passed around a memo, disclosing that PwC had erred in approving the accounting treatment for the off-balance sheet entities, the suit says.
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However, evidence emerged in the Andersen trial that Mr Fastow had rejected a particular accounting treatment for some of the off-balance sheet partnerships, adopting instead something that did not conform with American accounting rules.
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And it's actually an accounting treatment, as you know, that's been in place for a hundred years.
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PwC came to this conclusion after consulting with three of the other big accounting firms and each firm indicated that the unit didn't qualify for off-balance sheet treatment, the suit says.
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The accounting standards for both these trades and repo-to-maturity trades allowed off-balance-sheet treatment.
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