US government panel to examine mark-to-market

A US House panel will investigate mark-to-market accounting on March 12 with the aim of striking a compromise between proper investor disclosure and the needs of financial institutions.

But US representative Paul Kanjorski, chairman of the House Financial

Services' capital markets subcommittee, stopped short of wishing away the controversial practice altogether.

'While companies need stability, investors still need accurate information. We therefore cannot allow for fantasy accounting that wishes away bad assets by merely concealing them,' Kanjorski said in a statement announcing the hearing.

US industry groups have called on the Securities and Exchange Commission and the standard setter to modify or suspend mark-to-market accounting, claiming it is threatening the government's bailout of the banking sector.