The inexorable drive towards fair value
Article Abstract:
The International Accounting Standards Committee (IASC) is encouraged to review its approach to the harmonization of accounting for financial instruments. The Committee's exposure draft on the recognition and measurement of financial instruments (E62) advocates the use of fair value in accounting for all financial instruments. This presents a problem for banks because this method only works well when the financial instruments are held in a bank's trading books. For instruments held in the non-trading book, the more effective approach is the accruals method. The IASC is urged to look into E62's other significant shortcomings, such as the use of fair value for all hedged instruments, the use of the secondary income statement, and the introduction of interim measures when the information technology resources of banks are stretched to the limit.
Publication Name: Accountancy
Subject: Business
ISSN: 0001-4664
Year: 1998
User Contributions:
Comment about this article or add new information about this topic:
Disclosures in the financial statements of banks
Article Abstract:
An International Accounting Standards Committee exposure draft of proposed standards for bank financial disclosures is given. Investments, dealing securities, and investment securities are defined. Financial information disclosed by banks should serve one of the following purposes: to demonstrate bank solvency by applying income measurement and valuation rules; to demonstrate bank liquidity; and to describe the degree of risk attached to bank assets and liabilities. Proposed standards are discussed for the classification of assets and liabilities; and for the maturities of assets and liabilities, income statements, loans, and reserves.
Publication Name: Accountancy
Subject: Business
ISSN: 0001-4664
Year: 1987
User Contributions:
Comment about this article or add new information about this topic:
Discussion before decision
Article Abstract:
Issues discussed concern the banking industry's response to accounting standards that have to do with fair value reporting for all financial instruments. Debates will concern the efficacy of reporting the banking industries finances on the basis of a measurement of the full fair value of assets and liabilities.
Publication Name: Accountancy
Subject: Business
ISSN: 0001-4664
Year: 2000
User Contributions:
Comment about this article or add new information about this topic:
- Abstracts: FRED 13: derivatives and other financial instruments: disclosures. The STRGL between book and tax
- Abstracts: The usefulness of the value added statement in South Africa. Usefulness of value added reporting: a review and synthesis of the literature
- Abstracts: The economics of prepaying wealth transfer tax. The value of key-person life insurance for estate tax planning
- Abstracts: Comment on Fried, Lovell, and Yaisawarng. Evaluating the performance of US credit unions. The impact of mergers on credit union service provision
- Abstracts: The IASC's long march towards harmonization. Right idea, shame about the politics. US puts pressure on the IASC