Two Books onNumbersWiley’s release of the book

The Financial Numbers

Game: Detecting Creative

Accounting Practices by

Charles W. Mulford and

Eugene E. Comiskey was

set for the middle of Feb-

ruary 2002. As chance

would have it, the release

coincided with what might

turn out to be one of the

nation’s largest financial

scandals, and there is an

introductory note at the

beginning of the book

referring the reader to

Chapters 8 (“Misreported

Assets and Liabilities”)

and 11 (“Problems with

Cash-flow Reporting”) for

some insights into Enron’s

problems. This is more

appropriate than oppor-

tunistic because the

authors use examples

throughout to illustrate

concepts. In fact, so many

companies are referenced,

there is a separate index of

companies. The kinds of

“creative accounting prac-

tices” covered in the book

include aggressive

accounting, earnings man-

agement, income smooth-

ing, and fraudulent

financial reporting. The

authors’ purpose is “to

equip the financial state-

ment reader to better

detect the use of creative

accounting practices and

avoid equity-investment

and credit-granting mis-

takes.” A book for its

times. The John Wiley&

Sons, Inc. site is at

www.wiley.com.

The Ernst & Young Tax

Guide 2002 from John

Wiley & Sons covers all of

the sweeping changes of

the Economic Growth and

Tax Relief Reconciliation

Act of 2001. It has more

than 450 of its usual fea-

tures, (Tax Savers, Tax

Planners, Tax Alerts, and

Tax Organizers), a special

chapter on mutual funds,

50 of the most commonly

overlooked deductions,

tax forms and schedules

you can use, step-by-step

instructions, and where to

look for online help.

www.wiley.com

Punching,Crunching, andPublishing NumbersThe basic calculator that

comes with the Palm OS is

very handy. It has nine

functions including math,

trig, finance, logic, statis-

tics, and four kinds of

conversion calculators.

Sounds like a lot until you

look at Infinity Softworks’

powerOne™ Finance v3.0.

Designed for the Palm

OS-based handhelds

(including Palm, Hand-

spring, Sony, and

Kyocera), the powerOne

Finance calculator offers

comparable functionality

to Hewlett-Packard’s line

of financial calculators,

including the HP 19B. It is

available in a download-

able version or as a

Springboard module for

Handspring, and it fea-

tures touch-screen user

interface, RPN and stan-

dard input, and color sup-

port. Financial analysis

includes advanced annu-

ity, loan, and amortization

in the Time Value of

Money worksheet, cash

flows for Net Present Val-

ue, Internal Rate of

Return, Payback Modified

Internal Rate of Return,

price or yield of bonds,

Depreciation (Straight-

line, Declining Balance,

and Sum of Years), unit

and currency conversions,

percent change, markups

and markdowns, profit

margin, a Black-Scholes

option pricing worksheet,

and so on. There are 20

built-in worksheets and

more than 100 free addi-

tional ones at Infinity’s

website.

www.infinitysw.com.

There are times when

WYSIWYG seems to be a

sadistic joke. When the

text on the screen frag-

ments and jumps to new

positions on the printed

page, it’s usually time to

punt. With mathematical

notation, the joke can

become a nightmare. If

you need both text and

equations in your next

report, presentation, or

book, you need a mathe-

matics word processor.

Scientific WorkPlace by

MacKichan Software, Inc.

is just that, but it also has

two computer algebra sys-

tems (MuPAD® 2.0 and

Maple V® 5.1) that will

evaluate, solve, simplify,

expand, or apply a uni-

verse of math functions

from fraction reduction to

plotting approximate inte-

grals. The program will

also plot 2D and 3D

graphs with the tap of a

button. That’s the most

compelling feature of the

program—you input text

and math on the same

line, using the keys on the

keyboard and the buttons

on the screen for the math

formatting and symbols.

It’s all right on the screen,

and elements fit in where

they are told to go—they

don’t jump to the next

page in a new, very large

typeface. Your final docu-

ments can be set with or

without typesetting, you

can save and send them as

text or picture files, and

you can even post them

on the Web. There is a free

browser, called Scientific

Viewer®, for publishing

math online. Versions of

TeX and LaTeX are includ-

ed for international type-

setting, and there is an

Exam Builder for generat-

ing, grading, and record-

ing quizzes on a Web

server for those in acade-

mic settings. More

information is available at

MacKichan’s website.

www.mackichan.com.

58 STRATEG IC F INANCE I March 2002 Ma rch 2002 I S TRATEG IC F INANCE 59

Tech Forum

■ THERE SEEMS TO BE SOME CONFUSION. The

Internet bubble that recently burst in a dramatic illusion

vs. reality reduction was the one gassed up on Wall

Street, a place that recently has sprung some serious

leaks of its own concerning the reliability of its informa-

tion. The Internet revolution, on the other hand, contin-

ues to motor along at an accelerating pace, looking

more inevitable every day.

The Brookings Institution has published a small book

of numbers and explanations that tells why the network

continues to shape our economy and quality of life. The

book is Beyond the Dot.coms—The Economic Promise

of the Internet, and it was written by the director of Eco-

nomic Studies, Robert E. Litan, and Alice M. Rivlin,

senior fellow in the Economics Studies program. The

authors describe the Internet revolution as “likely to be

positive, significant, and sustained.”

Some Kind of Gauge

Taking nothing for granted, the book begins with the

question, “Is the Internet a big deal?” In the answer,

the authors present a central thesis that appears

throughout the study. Stated simply, it is the gains in

productivity created by the Internet that will improve the

economy and also our standard of living. And the Inter-

net can improve productivity in a number of ways: by

providing better tools to workers, by improving workers'

skills, and with organizational or management break-

throughs. Examples come to mind from across a wide

spectrum—time and expenses reported online, open

auctions for raw materials, tracking and scheduling for

truck deliveries, papers presented online for physicians

around the world, stock trading, and other financial

transactions. One of the Internet's most powerful offer-

ings, e-mail (and by extension, instant messaging), has

made a drastic change in the way we communicate.

But how do you measure the changes in productivi-

ty? The answers in Beyond the Dot.coms are the result

of the combined research of a group of experts put

together by the Institute in its Brookings Task Force on

the Internet. Sectors of the economy that were repre-

sented include education, financial services, govern-

The Handspring Module

The Internet Revolution—Dot.gone? Michael Castelluccio, Editor

continued on next page

powerOne™ Keypad and Worksheet

Scientific WorkPlace’s Push-button Environment