McCreevy says IFRSs are 'commercially flawed'

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10 Dec 2008

In an address before the Association of European Journalists, Charlie McCreevy, the EU Commissioner for Internal Market and Services, identified ten critical lessons from the current global economic crisis.

One of them, Mr McCreevy says, is that IFRSs are 'commercially and prudentially flawed'. Click for Commissioner McCreevy's Speech (PDF 69k). An excerpt:

The relatively new International Accounting Standards – especially in terms of the rules on provisioning for bad debts and the valuation of assets – are commercially and prudentially flawed. They have had unintended and damaging consequences for banks operating in illiquid markets and for the markets themselves.

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