Tuesday, September 30, 2008

The SEC on Fair Value Accounting

Today the SEC issued a release to clarify some factors in the use of fair value accounting.

The release states the following

"While the FASB is preparing to provide additional interpretative guidance, SEC staff and FASB staff are seeking to assist preparers and auditors by providing immediate clarifications. The clarifications SEC staff and FASB staff are jointly providing today, based on the fair value measurement guidance in FASB Statement No. 157, Fair Value Measurements (Statement 157), are intended to help preparers, auditors, and investors address fair value measurement questions that have been cited as most urgent in the current environment."

The release also urges transparency in the disclosures.

"....because fair value measurements and the assessment of impairment may require significant judgments, clear and transparent disclosures are critical to providing investors with an understanding of the judgments made by management"

The Release also acknowledges and supports the work of the IASB in this area. (I previously referred to the IASB's Draft document in a previous post).

1 comment:

The IFRS Exorcist © said...

please also refer to today's article in the CFO Magazine - just arrived in my in box