Borscht

Accounting 101: Too many years ago I sat through far too many accounting courses and though I remember little of what I learned, I do recall some inventory acronyms:  there’s LIFO (Last in First Out),  FIFO (First in First Out) and my personal favorite LAFO (Let an Accountant Figure it Out).  It turns out that the Former Guy and his accounting firm, Mazars, didn’t employ any of those methods, instead they went with GIGO (Garbage in Garbage Out).  At least that’s what Mazars more or less asserts in the letter they sent to the Former Guy’s business last week.  Saying that they are now aware that the FG Company manipulated its financial picture to its advantage, they want everyone, including all relevant legal authorities, the company’s lenders and their other clients, to the extent they still have any, to know that the last ten years of financial statements that they produced for the FG aren’t worth the paper they were printed on.  Also, citing potential conflicts of interest, possibly because they are now testifying about all the ways they say they were deluded or delusional, they also say that they can no longer work for the FG meaning that the FG’s company, the FG and Melania will have to find some other firm to do their personal tax returns.  We learned about Mazar’s assertions because their Dear John letter was attached to a document that NY Attorney General Tish James filed to justify her Ivanka and Don Jr subpoenas. Also, as a number of legal nerds noted, based on the Bates number at the bottom of the Mazars filing it appears that the accountants have provided the AG’s office with about 525,000 pages of information.  Citing some standard CYA language/Accounting speak in the Mazars letter, the FG’s spokesperson as well as a really freaked out son Eric responded by saying that the company’s years of financial filings, like everything the FG does, were all perfect and though they’re disappointed about Mazars betrayal, they will get over it.  The reality, Mazars dumping the FG and his business is a very bigly deal.  Accounting firms rarely walk from their clients, if the FG’s business was public its stock would be bouncing off the basement right about now. It’s fair to assume that the FG is now in violation of quite a few loan covenants, giving his lenders, primarily Deutsche Bank, the right to accelerate and/or change the terms of his outstanding debt.  Moreover with hundreds of millions of dollars of debt coming due, the already difficult task of securing rollover financing has gotten much harder if not impossible. Melania is going to have to sell a lot of white hats to cover what’s coming due.

On the Docket:  Of course right wing media isn’t all that concerned about the Mazars mess as they remain focused on Special Counsel Durham’s newest assertion.  In this one, Durham claims that Michael Sussmann the lawyer that’s been indicted for lying about his Clinton connections was working with tech experts to spy on the FG’s Tower and White House.  Putting aside that the basis for the Sussmann indictment may not hold up because Durham conveniently forgot to provide some potentially exculpatory  information to Sussman and his lawyers, this newest assertion appears rather flimsy especially since some of the alleged spying on the White House, to the extent it really happened, took place during the Obama administration.  Anyway, this story is all over the Fox universe but has gained little more than a mention anywhere else. In other news, the judge presiding over the Sarah Palin v NY Times case announced yesterday that he plans to dismiss her charges against the paper regardless of what the jury decides because he’s found no malice on the part of the NY Times, just an unfortunate mistake by a too harried editor.  He’s allowing the jury to continue deliberating because he knows that Palin and her lawyers are likely to appeal and wants to be able to forward their verdict, whatever it may be, on to the next court.   

Bombs and Rockets:  Yesterday President Zelensky joked that the Russian invasion would take place on Wednesday.  The once upon a time comic’s humor was received about as well as would be expected which isn’t to say that Putin won’t be invading tomorrow.  As to that possible invasion, the wily Putin is giving mixed signals.  On the one hand he’s amassed more attack helicopters within range of Kyiv, on the other he’s pulled back some troops and his Foreign Minister Lavrov is reported to have told him that attacking isn’t such a good idea so it’s anybody’s guess as to what will come next.  Speaking of Russians, the 15 year old wunderkind skater who will be skating today blames the performance drug in her blood sample on her grandfather, perhaps his heart medicine getting into her borscht?  Lastly, would it surprise anyone to learn that a whole bunch of foreign alt-right Facebook denizens, including some from the US, Brazil and Australia, amplified by right wing media, were likely responsible for making the Canada trucker mess worse than it would have been?