RegulationAccounting StandardsDud accounting standards ‘inflated RBS assets’

Dud accounting standards 'inflated RBS assets'

International accounting standards have been blamed for inflating the value of RBS holdings during the banking crisis

SUB-STANDARD accounting rules inflated the value of RBS assets by £25bn at the height of the financial meltdown, an expert has claimed.

Activist investor Tim Bush calculated that under the pre-2005 UK accounting rules, the bailed out bank would have held tangible shareholder assets worth £33bn – rather than the £58bn worked out using international accounting standards.

Bush, who is a member of the Urgent Issues Task Force that watches over the Accounting Standards Board, told The Telegraph the core tier one ratio for 2010 was erroneously inflated from 6% to 10.7%.

The House of Lords report into accounting practices is published tomorrow, and firms fear harsh conclusions about their role in the financial crisis.

 

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