Friday, October 10, 2008

FASB Releases Final FSP FAS 157-3 on Fair Value; G7 'Plan of Action' References Accounting

This evening, FASB released final FSP FAS 157-3, “Determining the Fair Value of a Financial Asset When the Market for That Asset is Not Active.” This FSP was issued in record time, as part of the response of standard-setters to provide guidance for applying the fair value accounting rules in inactive markets, as have been experienced during the recent market turmoil. For further background on this FSP, see our two posts from earlier today, here and here, relating to comment letters filed (including the comment letter filed by FEI's Committee on Corporate Reporting (CCR), and summarzing the discussion at today's FASB board meeting.

Separately, the Group of Seven Finance Ministers (G7) issued a statement today, entitled, “G7 Plan of Action” in which the last of five items on the list references accounting. That item states: “Take action, where appropriate, to restart the secondary markets for mortgages and other securitized assets. Accurate valuation and transparent disclosure of assets and consistent implementation of high quality accounting standards are necessary.”

In related news, see announcement released by the IASB today, “[IASCF] Trustees Support IASB’s accelerated steps on the credit crisis."

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