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(Revised from original 2011 version)
Mike Mayo Takes on Citigroup (A)
The case details the conflict between Mike Mayo, an influential banking analyst and Citigroup about what Mayo considers aggressive accounting policies. Mike Mayo questions Citigroup's lack of a valuation allowance against their Deferred Tax Assets despite Citi's recent loss. The case discusses the economics and accounting for deferred tax assets. It also focuses on management-analyst relations and challenges faced by analysts in providing bad news on companies. The inclusion of deferred tax assets in Tier 1 capital and implications for regulatory capital are also discussed.
Banks and Banking;
Srinivasan, Suraj, and Amy Kaser. "Mike Mayo Takes on Citigroup (A)." Harvard Business School Case 112-025, July 2012. (Revised from original August 2011 version.)