The International Accounting Standards Board has formed an advisory panel to deal with the controversial topic of determining the value of financial instruments in inactive markets.
Banks and financial services companies have been struggling with writedowns of assets, such as securitized mortgages, trying to determine the fair value of these securities when few buyers are willing to purchase them. The panel will assist the IASB with reviewing best practices in the area of valuation techniques, formulating additional guidance on valuation methods for financial instruments and related disclosures when markets are no longer active.
The panel's discussions will provide input for the IASB's ongoing work on financial instruments and fair value measurement. Members of the panel include insurer American International Group, the Basel Committee on Banking Supervision, BNP Paribas, Capital International Research, Citigroup, Deloitte, Deutsche Bank, Ernst & Young, the Financial Stability Forum, Fitch Ratings, Goldman Sachs, HSBC, the International Association of Insurance Supervisors, the International Organization of Securities Commissions, KPMG, Pioneer Investments, PricewaterhouseCoopers, Swiss Re and UBS, along with a staff observer from the Financial Accounting Standards Board.
The first meeting will take place on June 13. It will be private, but a summary will be available later in the month on the IASB Web site.
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