"The IASB (International Accounting Standards Board)has set up expert advisory panel to examine whether existing IASB requirements and guidance on the accounting and valuation of structured products could be improved. The advisory panel, which had its first meeting in early June, should draw upon the analysis undertaken by European banking and securities regulators. A specific area the Authorities call on the IASB to review is the current requirement that when any of an unrealised value loss on an available-for-sale security (broadly an investment security) is regarded as due to impairment, the entire loss has to be recognised immediately in the profit and loss statement. It is not clear this position is conceptually sound, and it creates an incentive for firms to delay timely recognition of impairment."The government appears to be pushing the idea that the IASB should drop the requirement that any unrealized losses on marketable securities be recognized. This seems to be saying that banks can effectively conceal losses by recording the historical rather than market values, or have I missed something here.
Many thansk for McC, who sent me an email pointing this document out to me.