The complex, complex deal exam

My complex deal professor invited his students to an Easter egg hunt this past weekend. No it wasn’t the type where you have to dress up as a bunny and run around someone front or back yard looking for wrapped eggs. This was the type where you sit at a desk for hours, flip through page after page of financial documents, and find the one or two nuggets of information that will earn you a respectable number of points toward the final.

 

He gave out the final exam last week and we had until yesterday to hand it in. Someone told me that a student who graduated this past May described the professor’s exams as “an Easter egg hunt” and that’s exactly how I would describe this past weekend’s exercise. I spent hours pouring through pages of financial disclosures regarding the bankruptcy settlement of Loral Space and Communications. One question asked why the company’s long term liabilities declined so dramatically between one year and the next. After spending an eternity trying to come up with an answer supported by the many paragraphs of notes and footnotes, I was ready to throw in the towel when I noticed that the current liability (current being anything that expires within one year hence not considered long term) went up substantially during this period. I simply wrote down that many of the long term liability became current liability.

 

As I was doing the exam, I remember something my professor said one day while talking about his exams. In his unique, Bushman-esque style, he said “hey if I were going to make it simple, I’d name the class simple deal.”