|
|
08 Oct 2008
Mark-to-market accounting has almost killed off the US insurer AIG, according to its former chief executive Martin Sullivan.
Testifying to a committee of the US congress on the financial crisis, Sullivan quoted market disruption and ‘multiple action by multiple parties’ ,according to the Financial Times.
But, he insisted the most telling factor was the accounting rule which said meant ‘trillions’ in assets could suddenly see ‘unrealised’ losses running into tens of billions.
However, former SEC chief accountant Lynn Turner said blaming the accounting was like blaming a thermometer for a fever.
The FT quotes Turner saying: ‘I don’t think the company was ever honest with the investors about the potential magnitude of these things, and that is what is grossly missing here.’
On Monday it was revealed that PricewaterhouseCoopers would pay $97.5m in damages to shareholders of AIG. The firm had been named in a law suit by three state pension funds.
More
You may also like
Search thousands of financial jobs:
Search thousands of financial jobs:
Careers
Search for jobs
Click to search our database of all the latest accountancy roles
Create a profile
Click to set up your profile and let the best recruiters find you
Jobs by email
Sign up to receive regular updates with the latest roles suitable for you
Briefings
By looking at the reasons supplier statements became unfashionable, and the reasons why it is different today, this paper delves into the many benefits that can be obtained by automating the process.
Having a real and true view of your organisation’s current financial position, and having the right systems and processes in place, will ensure that you can make strong choices and are ready to capitalise on opportunities
AccountancyAgeInsight is a frequently updated resource centre for finance professionals, offering a free and easy-to-use digital library of briefings, white papers and other information resources. 
Visitor comments Add your comment