The International Accounting Standards Board said its Fair Value Measurement project team has begun a standard-by-standard review of existing fair value measurements in International Financial Reporting Standards to assess whether each standard's use of a fair value measurement basis was intended to be an exit price.

Fair value measurement has become a controversial issue as financial institutions struggle to valuate mortgage-backed securities and other complex financial instruments. In the U.S., the Financial Accounting Standards Board has decided to postpone the effective date on which public and private companies would have to account for fair value measurements (see FASB to Delay Fair Value Effective Date).

The IASB has invited a range of companies to participate in its review, which is expected to be completed in the second quarter of 2008. The IASB will deliberate on the outcome of the review before roundtable discussions begin in the third quarter.

Responses to the discussion paper and the feedback the IASB receives during the roundtable discussions will help the board develop an exposure draft of a standard on fair value measurement guidance, which the IASB aims to publish in mid-2009.

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