Transparency

I encountered recently a quotation attributed to J.P. Morgan: the elder of the father-son financiers with that illustrious name. One has to give him credit for a neat turn of phrase here:

"The time is coming when all business will have to be conducted with glass pockets."

Morgan apparently said this in a spirit of weariness or frustration. The whole idea of public scrutiny of what he was doing was repugnant to him, but he was practical enough to make some adjustments in that direction, and to prophecy that his heirs would have to go further.

The idea of business transparency has made some headway in the ninety-six years since the elder Morgan died. But then, by the standards of most earthly projects, that's a long time. Morgan barely lived long enough to see the inauguration of Woodrow Wilson.

These thoughts come to my mind this morning because the world is moving closer toward one prerequisite of transparency -- a single global system of accounting standards. The fact that different countries and regions have long had different standards can itself make balance sheets and income statements confusing or (in terms of our guiding metaphor here) opaque.

http://www.financialweek.com/apps/pbcs.dll/article?AID=/20071119/REG/711190318/1016/ECONOMY