In 2008 the company had failed to elect to mark debt to market while required by FAS to mark assets to market, thereby creating a accounting imbalance. It was my understanding that when the company aquired new debt, that would be marked to market. Am I right in assuming that ACAS's new debt will be marked to market and therefore avoid the problems we experienced with the recession of 2008?????
I doubt mark to market of debt would impact ACAS. From what I can tell you mark debt when the actual amount at risk to the company is lower than the amount of the debt. So if you had a CDO or special purpose entity with assets less than the value of the assets and the debt is nonrecourse you mark the debt down. The theory is that the debt is worth less becasue the supporting assets won't cover it. The company won't pay the full amount because it doesn't have to. None of this seems to apply to ACAS.
I am no expert on this subject, but I thought I read a couple of years ago that it was a one-time option and that it could not subsequently be changed. If someone actually knows (particularly regarding new debt), please comment.