Corporate tax evasion and the "asset write-down" gambit

I've broached the topic before, but I am once again moved to wonderment at the alacrity with which corporate asset write-downs are accomodated.

Whenever you read "asset write-down" think tax dodge.

Been reading about the First Quantum take-over of Inmet. While it's early days to pronounce judgement on that take-over, I suspect that in ten years it'll look like a stroke of genius.

I'm also guessing that before it's recognized as a stroke of genius the commodity cycle will cycle lower once or twice, giving First Quantum a chance to take massive asset write-downs.

Asset write-downs produce artificial losses which then produce very real reductions in tax obligations. In fact, the linked article makes multiple references to this phenomenon.

There is no third-party verification required to declare such a write-down. We are to believe that all those highly paid MBA's just didn't read the tea leaves correctly and, oops, Company X now has no choice but to to take an oh-so-embarrassing multi-billion dollar write-down.

Especially in a business as cyclical as mining, the write-down offers enormous opportunities for fraudulent tax avoidance.