Six US groups urge the SEC to provide more fair value guidance
29 Oct 2008
The leaders of six US business organisations have written a joint letter to the Securities and Exchange Commission asking that "the SEC issue elaboration on the use of judgment in fair value accounting".
The letter states that the lack of guidance in this area "has the potential to cloud transparency". The letter was written by leaders of the US Chamber of Commerce Center for Capital Markets Competitiveness, Financial Services Roundtable, Property Casual Insurers Association of America, American Council of Life Insurers, Mortgage Bankers Association, and American Insurance Association.
Click to Download the Letter (PDF 93k).
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We would respectfully request that the SEC formally elaborate on the use of judgment in the application of FAS 157. This elaboration, by the SEC should include principles-based guidance for the transparent disclosures needed by investors when judgment is exercised. The elaboration will provide the clarity needed by management to appropriately value assets in inactive markets, and give investors the transparent information needed to make informed decisions. |
