The mismatch between today's "high-tech economy" and the double-entry accounting system has raised serious questions about the quality of earnings. The Securities and Exchange Commission (SEC) has targeted overly aggressive earnings management, focusing on acquired in-process research and development (IPR&D). Some people are concerned that the SEC crackdown on IPR&D valuations has the potential to slow the pace of mergers and acquisitions significantly, hamper the formation of new companies, and decrease the value of a company's stock. Financial managers on either side of the debate will need a clear understanding of the issues when evaluating potential acquisitions.