BusinessCompany NewsLeading banks petition for relaxation of fair value

Leading banks petition for relaxation of fair value

The relaxed rules would allow financial companies to value illiquid assets at historical cost instead of at market value

The top global banks have proposed to have fair-value rules relaxed in an
effort to break down the ‘downward spiral’ of huge writedowns, fundraisings and
fire-sales of assets.

The suggestions, from the Institute of International Finance – a grouping of
more than 300 companies chaired by Deutsche Bank chairman Josef Ackermann –
would allow financial companies to value illiquid assets at historical cost
instead of at market value.

The suggested plan would also allow banks who kept assets on balance sheet,
to be free of the requirement to hold them until maturity and so be released to
sell such assets after two years, the
FT
reported.

The proposal has been sent for consideration to US and European central
banks, governments and accounting watchdogs.

Further reading:

Off balance sheet structures too risky

PCAOB to carefully scrutinise securities valuations in
accounts

Use fair value but disclose more – Fitch

Related Articles

BDO replaces Deloitte as Mitie auditor

Audit BDO replaces Deloitte as Mitie auditor

3m Emma Smith, Managing Editor
CVR Global appoints partner in London office

Company News CVR Global appoints partner in London office

7m Alia Shoaib, Reporter
FTSE100 failing to provide adequate ethics information

Company News FTSE100 failing to provide adequate ethics information

7m Alia Shoaib, Reporter
Moore Stephens recruits new private client partner

Accounting Firms Moore Stephens recruits new private client partner

10m Emma Smith, Managing Editor
Magma Group announces merger, partner promotions

Accounting Firms Magma Group announces merger, partner promotions

10m Emma Smith, Managing Editor
BDO on ‘recruitment spree’ with multiple partner appointments

Accounting Firms BDO on ‘recruitment spree’ with multiple partner appointments

10m Emma Smith, Managing Editor
Brand strength leads to fee income growth for RSM

Accounting Firms Brand strength leads to fee income growth for RSM

10m Emma Smith, Managing Editor
Mazars strengthens audit team with partner appointment

Accounting Firms Mazars strengthens audit team with partner appointment

10m Emma Smith, Managing Editor