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FASB Changes Mark to Market Rule
AP:
The board that sets U.S. accounting standards on Thursday gave companies more leeway when valuing assets and reporting losses, providing a potential boost to battered banks’ balance sheets.
The independent Financial Accounting Standards Board voted to adopt new guidelines under the so-called mark-to-market accounting rules, which require companies to value assets at prices reflecting current market conditions. The board was meeting at its headquarters in Norwalk, Conn.
The changes, which apply to the second quarter that began this month, will allow the assets to be valued at what they would go for in an "orderly" sale, as opposed to a forced or…
3Apr2009 | The Real Deal | 1 comment | ContinuedU.S. Treasury Looking to Create Floor Under Toxic Security Prices
The U.S. Treasury’s much-maligned Term Asset-Backed Securities Loan Facility (TALF) and its new “prequel,” the Public-Private Investment Program (PPIP) have been viewed by the markets and skeptical prospective participants as merely a price discovery mechanism which, with a lot of luck, might create a floor under toxic security prices.
Now, with markets showing signs of life, and relief from dreaded mark-to-market accounting rules passed yesterday (Thursday), the intended price discovery floor may actually become a foundation for climbing out of the credit crisis. But will it work?
How strong the foundation will be, on whose backs it will be built, who will be able…
3Apr2009 | Money Morning | 0 comments | Continued
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