Saturday, September 17, 2011

Bank Accounting once again

Jonathan Weil has an illuminating piece on the way in which the accounting standard setters have caved in to politcal pressure to abandon fair value accounting for financial instruments and the mess than has resulted as a result.

How can investors make sense of bank balance sheets where the same assets are accounted for differently by different banks without some kind of restatement? Basically they can't. They shouldn't.

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