American Institute of CPAs’ president and chief executive Barry Melancon reiterated his organization’s stance that fair value accounting was not a primary cause of the current economic distress and that the private sector — rather than Congress — should continue to set accounting standards.
“We don’t believe fair value accounting to be the cause of the economic situation we’re in. We believe it aids transparency.”
Melancon, who also serves on the board of the U.S. Chamber's Center for Capital Markets Competitiveness, where he participated in a series of panel discussions and hearings, held a conference call with reporters to address a number of top issues impacting the profession one day prior to today’s scheduled hearing on mark-to-mark accounting before the House Financial Services Committee’s Subcommittee on Capital Markets, Insurance, and Government Sponsored Enterprises.
“During the course of the day, I don’t recall hearing anyone who was for the suspension or termination of fair value standards.”
Mark-to-market or fair value accounting has become one of the flashpoints of national debate during the current financial malaise, with a number of organizations calling for the loosening or outright abolition of the standards.
While defending fair value he admitted that the standards could probably use some tweaking.
He also continued the AICPA’s position that the Financial Accounting Standards Board should continue to set accounting standards. “We support private-sector standard-setting. Congress should not be in the business of setting accounting standards.”
The institute head also touched on auditing issues such as going concern opinions and the increased use of “judgment,” as well as the convergence roadmap for the use of International Financial Reporting Standards. He revealed that in late 2011 or early 2012, the CPA Exam would include IFRS questions as part of the institute’s “readiness program” in preparation for convergence.
He also opined that it was early in the process to assess the recent proposal by two lawmakers to create a super overseer to the profession – a Federal Accounting Oversight Board.
“There’s a lot of looks going on with regard to comprehensive regulatory reform. It’s probably too early to focus on just one.”
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