PM sidesteps fair value question from Cameron

Prime Minister Gordon Brown ducked stating his view on suspending mark-to-market accounting when challenged in the House of Commons yesterday.

Tory leader David Cameron questioned Mr Brown in the Commons
over the decision of Eurozone EU leaders 'to examine the mark-to-market
accounting rules', asking: 'Does the Prime Minister now
support suspending those rules?'

Mr Brown ignored the question, concentrating on other aspects of Cameron's
questions on the outcome of the Council meeting concerning access to
European Investment Bank funds and the need to get China, India, Brazil,
Mexico, South Africa and middle eastern countries aboard his quest for
international co-operation on financial regulatory reform.

Previous statements have suggested Mr Brown does not believe accounting is an underlying problem or that suspension would be a good idea.

Earlier Mr Brown said he would submit a detailed set of proposals on
'transparency, integrity, responsibility, sound banking practice and
international governance, with co-ordination across borders' to a proposed
meeting of international leaders.

He told MPs: 'These proposals include insisting on openness and disclosure,
with off-balance sheet vehicles brought back on to balance sheets, greater
transparency around the use of credit derivatives, and a rapid adoption of
internationally agreed accounting standards so that value-impaired assets
can no longer be hidden.'

He said there mist be an end to 'all the conflicts of interest that have
distorted behaviour and undermined trust, so that credit rating agencies no
longer act as advisers to the companies they rate, and executive
remuneration rewards not excessive or irresponsible risk-taking, but hard
work, enterprise, effort and responsible risk-taking'.

The European Commission is today expected to discuss further changes to accounting rules, specifically a carve out of IAS39 that would allow all classes of financial instruments to duck a fair value calculation by being reclassified from 'marked for sale' to 'marked for investment'.

Investors have argued against a further carve out saying it would undermine transparency and comparability of accounts.