PracticeAuditTurner report should avoid rules change

Turner report should avoid rules change

Profession anxiously awaits Lord Turner's report, as a regulatory shake-up could result in unnecessary changes to accounting rules says a financial services specialist

Lord Turner’s report on regulation of the finance industry should avoid
proposing ill-informed changes to accounting rules, an expert has warned.

As Accountancy Age went to press the profession was anxiously
awaiting the publication of the Financial Services Authority chairman’s report,
due to be published yesterday.

It is expected to unveil proposals to tighten up financial regulations for
banks, hedge funds and tax havens.

One financial services specialist at a Big Four firm said there were worries
that a regulatory shake-up could result in unnecessary changes to accounting
rules.

‘If you get comments [from politicians] that are trite and less informed it
will have a bad impact on accounting,’ the source said.

‘We want a reasoned argument in the Turner report about the need for change
in accounting if he sees fit but you should not have that accounting change
driven by regulators.’

Any references in the report to the ‘fair value’ accounting rule will be of
particular interest. The rule has been blamed for exacerbating the billions of
pounds of recent bank losses.

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