As most corporate executives know, in March 1976 the Securities and Exchange Commission issued an order for inclusion of replacement-cost data on inventories and fixed assets, and on the related cost of goods sold and depreciation expense in their 1976 annual financial reports. Businessmen have received this order with reactions ranging from mild disapproval to anguish, as the comments by filing companies show. Typical of the responses sent to the SEC was that of General Motors:
A version of this article appeared in the September 1977 issue of Harvard Business Review.