Auditors at some of the largest accounting firms are working on tougher standards for valuing the assets of banks in an effort to calm jittery investors.
Representatives from the Big Four accounting firms, along with BDO Seidman and Grant Thornton, are collaborating on a paper that would provide a uniform way for auditors to assess the holdings of banks at a time when the value of those assets is increasingly being called into question.
According to a report by the Financial Times, the paper will be published next month and will draw on the relevant rules under International Financial Reporting Standards. A similar paper has already been issued for U.S. generally accepted accounting principles.
The paper describes the practices used by the firms to evaluate bank holdings, but stops short of providing guidance on the standards. A draft of the paper has been sent to regulators and standards organizations such as the International Accounting Standards Board to examine before it is formally issued.
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