which is what it did in this case and not do you think they know that the parties disagree about the scope of either what the c i t did or even what it's authorized to do but if you recast to the c i t's characterization of the evidence below rather than saying it was unkind word it in and say instead that what the c a t did in effect is to say there was no substantial evidence to support converses treatment of this account as not being foreign exchange losses not associated with a capital innocent you wouldn't under those circumstances disagree that the court had the power to do that even though i'm sure you disagree that it ought to do it on the facts of this case but you would disagree with the author authority of the court act in that set knowing that not necessarily you're out of it but that's not what happened in this case evidence and came up with a different conclusion there are really two key factual issues at the heart of the c i p is decision where it put itself in the role of fact finder and reversed what commerce and done to general company loans the commerce department looked at that using its team of expert forensic accountants the petitioners looked at that the evidence the documentation with its expert accountants was not able to make that link in commerce specifically found that the that evidence that documentation did not support the claim that it can chill are made that that account was it consisted of foreign exchange losses wealth consists of a foreign exchange losses are consisted of foreign exchange the evidence that there was that these amounts represent foreign exchange pretty strong would you not agree i would respectfully disagree here i mean i think the starting point you have to look to is one of the compan are foreign exchange losses look at the oh you disagree with me that i mean looking at this i see page after page in which it i assumed the right hand writing was put on before these materials were submitted to congress but the handwriting disputed account was made up of cat capitalized assets relating to melt shot modernization ok so unrelated the books and records show it was unrelated to foreign exchange losses now what the kinsler attempted to do was to submit additional evidence to say well wait we actually misclassified that item on our own books and records we basically lied on our own books and records as to what that asset was commerce looked at that evidence petitioners looked at that evidence again using expert accountants and was not able to tie the documentation to the claim that it can chill are made that in fact congress should not treat that disputed account as a capitalized situation is during a review for example if commerce comes across a foreign exchange loss it's assumed for purposes of this argument that that is a foreign exchange loss and we're talking about the ex general practice typically as to expens decide at that point ok based on our statutory requirement we have to determine whether that capitalized asset as an effect on period cost and the  cited a lot of cases in terms of that war standards in terms of gap in international accounting standards to argue that as well as commerce cases to argue that they stand for the proposition that you always have to expense foreign exchange losses problem is here that's not what we're dealing with that foreign exchange loss again assuming that's what it was was already capitalized as an asset and they have not been able to cite one case or one standard that says that once that's done you can simply ignore the effect of that even if there's a benefit in the period of review which is a look up here for since you've moved on to that question i explained to me why it is in your in your brief a couple of times you say well that question that commerce was faced with which was the actual costs of production so because if you if you get a better loan because you lied about your assets that doesn't that just mean that you have lower cost of production well that  rate loan and therefore that prime rate loan whether i ought to have gotten it or not is my quote part of my cost of production i correct ok then why is the fact that the balance sheet has led the bank to give me a lo that they shouldn't have given me why does that affect the cost of production because well because if you've got the question is do instead of my concern is well let me see if i can answer you either believe i do so the question that co face is faced with these sort of again these are technical highly complex accounting issues it has to match a cost to benefits that are incurred in a period and so what it did here in terms of its conclusion that you have an inflated balance sheet was that the benefit that was experienced during a period of review was for example as you indicated increased periods of solvency and therefore it could attract investment credit get better credit terms that has a direct impact on overall cost and that's part of the cost that congress looks at in terms of of production i mean that's part of the calculation in terms of of of the commerce department determination with if you lower the costs you're going to have sales that remain in the form are the comparison market that otherwise would be kicked out of the calculation and therefore it can have exactly the opposite result you're on that if you lower those costs otherwise low priced for example sales and the comparison market remaining in the calculation as opposed to being kicked is supposed to be dropped as opposed to dropping out of that calculation and therefore you can have a you know it can improve your margin in that regard so again i mean i think the bottom line here is you know we're dealing with a very complex issue here i think this  recognized especially when you when you're dealing with issues with respect to depreciation with respect to expensing that there needs to be substantial deference provided to commerce because it has unique issues i think in particular that's the case where as the courts that review those decisions are charged with issues relating to the law and this is one of the issues relating to look as is whether the about the uncontroverted evidence i'm not sure exactly what the organizational tree judge had in mind i mean i suppose technically it was uncontroverted and that was in any evidence being introduced in the on the other side of the question it was just a question of whether the evidence that consoler submitted was mission but but there is a question of substantial evidence and that the judge has to grapple with this not only something issue recognise that fact that it kinchela had to come out and provide the evidence it failed to do so here but in addition i think it's important to understand that really there's too there's a two step process even if again we don't think the record evidence shows that these catalyze assets are consist of foreign exchange losses but even if and this is what commerce said even if they work the question is still when you capitalize those treat those as a capitalized  you need to make an adjustment you need to account for that to make sure you've captured it in your period cost the c i t overrule comedy they took that actual issue again this is a very complicated technical accounting issue and the c i determined that no one can have know if that the c i t is not allowed to do that it cannot put itself in the role of a fact finder and find and replace with respect to whether or not that it that treatment again assuming that it is a foreign it represents foreign exchange losses when it's capitalized does that have been a factor as we talked about before it can have a direct effect on the market first point that the parliament acted consistently with the company's own books and records and the easy answer to that argument is that's not enough it's not enough under the statute and it's not enough under this court's prior decision in a  one this is the second time this issue is before the court it came up in the proceeding two thousand fourth two thousand and five administrative review late in the perceiving when it concerns had no chance to per cent any evidence as to what the account reflected opportunity to come forward with evidence to demonstrate that it did not properly capitalize those expenses in the first place and that's what we did also under the statute it's not enough for congress to simply say this is the way it is on your books and records cancellers evidence that its own records were not an accurate reflection of the proper characterization of the transaction what if those if  keep providing evidence when i'm going to tell you where the deficiencies are we're not going to tell you what we need we're not going to tell you where any problems are and then at the end of the day we can just say it's not enough that the statute doesn't permit the statute requires congress to give requires and if there's a deficiency to notify consular of the deficiency congress never said we looked at your documents and we can't tie this to that we don't know where these loan agreements belong this provides more information they never did that the only decision they made was at the end of the day the say it's not enough and it's not permitted to do that under the statute this court sits in the position of a board of international trade and can review the evidence i don't know how the fishing or even get up with a straight face and say that there is no evidence that these were exchange losses well but the argument that the petitions making this if they were exchange losses tied to loans that were not general of loans but rather the right word and that's an excellent point because that's the wrong accounting standards ok it under the accounting rules under that all of the mechanicals turkish accounting rules s generally accepted accounting principles and the international financial standards there are only a limited circumstance in which exchange losses can be capitalized they can only be capitalized when they relate to the acquisition or construction of fixed as we didn't have to demonstrate and cover certainly didn't tell us we had demonstrated that these relate to general loans all we had to show was that these were exchange losses and that they did not relate to the purchase of fixed assets and that we showed and  international trade looked at the arguments and that is that is that big are you saying that you showed that it was not related to success that's because there weren't any fixed assets in the account where they should have been because we've already demonstrated that it can hundred zation of the minister you stage it seemed to blow right by congress whole first point which is they said we really aren't able to determine from the material that it can s that's what this animal it's well there's two issues under the accounting standards as i mentioned we need to show that these were extremely losses and we needed to show that they were not tied to the purchase reconstruction of but as the court said in a council one of the statute says they still need the commerce department needs to make of the terminations as to whether those assets that that asset account reflects what it says reflects whether the underlying expenses were properly capitalized again i go back to the statutory language something else mr shane never talks about the statute in this case it talks about the proper allocation of costs assets are not costs congress is required by the staton to look beyond the ask that the see what the cost is you know allocate assets you know cost of production doesn't come from assets it come from underlying costs i'm going says obligation was to look at the evidence on the underlying os and make factual findings as to what their nature was didn't do that here you are you're suggesting this is the this are you getting into the point that mr shane and i were discussing as to whether the overstatement of the assets resulting from the failure to depreciate an asset in a capital account resulted in a distortion of the costs i can address that that the notion that that's where you  that continues indefinitely it's almost akin to a goodwill that is not to preach it again congress created this as a fixed asset but the principle fixed asset plant machinery and equipment which is depreciated over five years because that's the useful and maybe i'm barking up the wrong tree here but it strikes me that if i distort my books and claim i have this very valuable asset which i don't that doesn't mean it's absolutely correct the again the problem for the petition is in this is to explain why this cost that we all agree originated in two thousand and two thousand  why that creates a cost of production for steel reinforcing bar rebar that if you look produced in two thousand and five and two thousand x unless they can tie it from some piece of evidence the fixed asset that's depreciable over five years comment on the question of weather the evidence adequately shows a connection between those three loans i think the for the five and the ten point four to five million loans and the foreign exchange because that's where i think the evidence gets to fussiest would you agree with that passage i would agree with that because we didn't understand we didn't we weren't trying to tie those loans and if we were just putting those those loans in as evidence that it kinzler foreign currency loans that it used for purposes other than purchasing pigs at a time we never intended to tie it out our our objective in showing that the exchange losses were not related to fix assets are was done through the account itself which showed no purchase or opposition of vick's assets and you know and the fixed asset ledger which showed that there were no other fixed assets other than those that were listed in the account we never intended to tie those loan agreements everything or if we had we would have provided all twenty real monogram us congress never asked for additional loan agreements they never asked us to tie the loan agreements  to the financial statements so there is no evidence to support commerce this finding that you cannot tie a consumer's records to the financial statements or to the much up account we showed those exchange losses flowed right through to the and we showed up before the court of an awful trade and after the argument that we never showed that the commerce that he was a direct your corrupt judge bryce and all of those handwritten note patients on the documents with the numbers showing the links to the various documents that was provided t commerce there's a written explanation and one of the submission for the commerce it was all laid out congress had no interest in looking beyond the existence of the mill shop but kept and you got to understand the reason why at the time they were deciding th this case the prior case was on review and if congress had come up with a determination saying oh we looked at the evidence and we agree with the insular that the evidence shows that these amounts had never been capitalized that would have undercut the earlier decision that the problem in the earlier case is a consoler didn't submit the material even when it we did we had no opportunity to that ok but i mean that we didn't submit it on as right there was no record and there is a record here and that's the difference between this case here as to whether the port of international trade exceeded his authority the decision didn't reverse commerce the c i he remained of the case the commerce commerce not the c i to recalculate it against  discretion even after the cia has decision to decide that some of those expenses in the melt up account were not relating to exchange losses and they could have continued to impute depreciation on those expens indeed do you think that that was a question that i was left puzzled by i'm not sure commerce read the c i t's opinion that way giving them that freedom in other words you think that the congress could have said well the c a said to us that we should take away the depreciation for let's see the language of the amount that currently reflects the foreign exchange losses in the done it probably not zero not based on the administrative record but they could have found that some of them were not demonstrated straight losses absolutely we never argued and the c i t never stated that all of the expenses  so my reading of the decision certainly was that they had this question well and they were also permitted by the way on remand since the c i p did not limited to discretion in a way that they could have reopen the record they could have asked more questions  books and records i think critically the responding here kinchela did not provide any written explanation explaining how those very complex documents somehow tie and established that that  dispute account was made out of foreign exchange losses there was no explanation provided to commerce again commerce with its experts the titian as with their experts was not able to make a link and tie that evidence to the well i would say look the problem is number one again i mean i'm going to you've got to defer to commerce in this area i mean commerce has the expertise to look at this and was unable to make that tie in to the  sure how you match up and link up those numbers i mean how you get from the documents and this is what commerce had to get from the documents the figures in those documents to the final numbers in the in the child modernization account commerce department had discretion in terms of how it acted after that remained or what the c i t found was that the disputed account was made up of quote almost depreciation to foreign exchange losses in that account what that amounts to and what how commerce interpreted it or any reasonable person would interpret that is in order to recalculate the margin without imputing depreciation there was no leeway there for the commerce department to somehow determine that those part of that account was not made up of or comprised of foreign exchange it's hands were tied it said as much in its determination and the c i