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October 28, 2008 at 12:01 PM
The U.S. Securities and Exchange Commission is holding a public roundtable Wednesday on whether changing asset accounting rules could help ease the current economic turmoil.
The SEC and accounting authorities came up with the prevailing “mark-to-market” account rules to require companies to include updated estimates of the value of assets and liabilities in their financial statements, rather than relying on the initial values, or updated “adjusted” values.
Supporters say the mark-to-market rules make public companies’ financial statements easier to understand. Critics say the rules cause investors to panic over asset value fluctuations that might have caused few problems for the companies or the investors in the past.
During the SEC panel discussion, which will start at 9 a.m., participants will talk about the usefulness of mark-to-market accounting to investors and regulators; the effects of mark-to-market accounting on financial reporting by financial institutions; the potential market behavior effects resulting from mark-to-market accounting; and thoughts about how to improve current accounting standards.
The scheduled panelists will include investors, issuers, auditors and others with experience in mark-to-market accounting by financial institutions, SEC officials say.
One panel will include Scott Evans, an executive vice president at Teachers Insurance and Annuity Association-College Retirement Equities Fund, New York, and Richard Murray, a managing director at Swiss Reinsurance Company, Zurich.
Murray is chairman of the Center for Capital Markets Competitiveness at the U.S. Chamber of Commerce, Washington.
A second panel will include Bradley Hunkler, the controller for Western & Southern Financial Group Inc., Cincinnati.
Murray already has submitted one comment letter on the mark-to-market accounting issue on behalf of the Center for Capital Markets Competitiveness. On behalf of the center, Murray also joined with representatives for 5 other financial services groups to submit another comment letter.
When Murray wrote on his own, he asked the Financial Accounting Standards Board, Norwalk, Conn., and the International Accounting Standards Board, London, to conduct a broad review of the unintended consequences of implementing the current mark-to-market reporting standards.
