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.