FASB issues proposal on fair value reporting options.The Financial Accounting Standards Board Financial Accounting Standards Board (FASB) Board composed of independent members who create and interpret Generally Accepted Accounting Principles (GAAP). has issued an exposure draft that would provide companies with the option to report selected financial assets Financial assets Claims on real assets. and liabilities at fair value. Under the option, any changes in fair value would be included in earnings. The proposed standard seeks to reduce both complexity in accounting and volatility Volatility 1. A statistical measure of the tendency of a market or security to rise or fall sharply within a period of time. 2. A variable in option pricing formulas that denotes the extent to which the return of the underlying asset will fluctuate between now and the in earnings caused by differences in the existing accounting rules. Under this proposal, entities would be able to measure at fair value financial assets and liabilities selected on a contract-by-contract basis. They would be required to display those values separately from those measured under different attributes on the face of the balance sheet. Furthermore, the proposal would require companies to provide additional information that would help investors and other users of financial statements to more easily understand the effect on earnings. A copy of the proposal may be downloaded from the FASB's Web site at www.fasb.org See .org. (networking) org - The top-level domain for organisations or individuals that don't fit any other top-level domain (national, com, edu, or gov). Though many have .org domains, it was never intended to be limited to non-profit organisations. RFC 1591. . Comments are due Apr. 10. |
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