Investor group says FASB is compromised

An advisory panel of investors has accused the US accounting standard setter of losing its independence after it succumbed to political pressure over mark-to-market accounting changes in a fiery letter.

The group said the Financial Accounting Standards Board should have fought off pressure from politicians and lobbyists who sought special treatment for banks with toxic assets on their books, Reuters has reported.

The panel, the Investors Technical Advisory Committee was set up by FASB to act as a barometer for investors on accounting rules.

Members include representatives from the CFA Centre for Financial Market Integrity and analysts from Moody's Corp, Standard & Poors, Sachs & Co, JP Morgan Securities and the California Public Employees' Retirement System.