FASB Backtracks On Fair Value Accounting

Law360, New York (January 25, 2011, 5:52 PM EST) -- The Financial Accounting Standards Board decided Tuesday not to pursue the so-called fair value accounting proposal designed to value loans on the basis of market changes, which had long met with significant opposition from banks.

The FASB unanimously approved an accounting model for financial instruments that reversed its prior proposal to record all financial instruments at fair value rather than at book value. Fair value, or mark-to-market, accounting mandates that companies value their assets based on current selling prices.

The decision is expected to result in...
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