The fair-value fall-out. By Rob Lewis
Growing liquidity problems, and a recent re-think at the IASB, suggest the tide seems set to turn for fair value and mark-to-market accounting. Many of the financial institutions and accounting firms that championed its cause in the growth period are exhibiting waning enthusiasm now that assets cannot be easily divested.
In the US, American Insurance Group (AIG) was the first public company to come out and criticise fair value after a record quarterly loss of $11 billion following a mortgage write-down.