RE:RE:Mark to Market "Mark-to-market accounting is a technique that measures the value of a security BASED on its current market value instead of its book value. This can work well when trading securities, but it can be disastrous for ACTUAL business."
Mark-to-market accounting can be easily manipulated .
"The principal method that was employed by ENRON 'to cook its books' was an accounting method known as mark-to-market accounting. Under MTM accounting, assets can be recorded on a company's balance sheet at their fair market value (as opposed to their book value)."
ENRON used MTM accounting in two ways. One way was as you speculated and the other way was as GFL is now using the MTM accounting principal.
I would argue that MTM accounting leaves too much to the imagination. Too subjective in nature, ripe for abuse, requires a constant adjustment of asset values (which is often neglected) based on market fluctuations and subjective judgements.
Will be interesting to see what comes out of the SPRUCE POINT CAPITAL MANAGMENT investigation of Securities Claims Against GFL. Also Investigation of internet claims that GFL's CEO has ties to "Organized Crime". ONTARIO TEACHERS PENSION PLAN & B C PARTNERS ADVISORS (who championed the huge investment) must be concerned. Did they do a thorough job of their due diligence? Hopefully this company will thrive eventually and everybody will he happy.
GLTA.