Inventory Accounting Switch and Uncertainty
在期权框架下分析企业是否从FIFO转为LIFO的决策，权衡当前税收节省与推迟转换的时机期权价值，发现未来经济不确定时放弃当前税收节省可能是最优的。
Typically, a LIFO firm may not switch back to the FIFO method except after being approved by the Commissioner of the Internal Revenue Service and paying a tax penalty, but a FIFO firm can adopt the LIFO method at low cost.1 In a world of uncertainty, the ability to postpone an irreversible decision is a valuable option. In this paper we identify, in an option framework, trade-offs involving current tax savings obtainable from a LIFO switch and the value of a timing option of postponing the switch. We show that it can be optimal to forego certain current LIFO tax savings when the future economic environment is uncertain.2