SEC to explore mark-to-market alternatives

The US Securities and Exchange Commission is to take mark-to-market
accounting to task in a series of roundtables that will examine the role fair
value played in the current market turmoil.

The first roundtable takes place on 29 October and consists of two panels,
one discussing the relationship between fair value and the financial crisis that
has enveloped the major banks with the second examining potential changes to the
current accounting models.

Fair value has been lambasted by financial figureheads and politicians in the
US, UK and Europe for intensifying the effects of the credit crunch, with many
calling for the model to be suspended during the current turmoil.

‘These roundtables will provide the Commission with valuable insights from
investors, issuers, and others affected by recent developments in the
marketplace,’ said SEC chief accountant Conrad Hewitt. ‘We are interested in
hearing participants’ views on transparency and usefulness of reported financial
information in times of market turmoil.’

Further reading:

FSA chief says mark to market
must be debated

Europe battles over fair
value carve out

Related reading

Fiona Westwood of Smith and Williamson.