Hello? Is there anyone home at the Financial Accounting Standards Board (FASB)? Admittedly, there is no shortage of examples of companies on the wrong side of the law or compliance. But at a certain point when very smart finance people–including those at FASB–cannot agree about what a rule says or covers, one must start asking what is wrong with the rule and not what is wrong with those struggling to stay on its good side. Such is the case with FAS 133. While regulators may be correct that they are not changing rules–rather simply enforcing them in cases such as Fannie Mae and General Electric Co.–what is becoming ever more apparent is the inability of regulators to plainly and adequately explain them in the first place to companies who, for the most part, want to do the right thing. This produces exactly the kind of inefficiencies and excess costs that critics like to scream about–as treasury staffs devote themselves to worrying about whether changes in the value of tens, or hundreds, of derivatives perfectly offset changes in the underlying exposures.

Instead of focusing on future economic value, companies are focused on backward-looking accounting. How can this possibly be good for the financial well-being of companies? Sarbanes-Oxley at least has the benefit of making companies upgrade financial controls and move to a more automated and audit-friendly trail, which discourages fraud and should eventually improve efficiency and performance. FAS 133 offers few such perks. But the two rules share one characteristic–the full explanations for how to implement them are coming years after they took effect.