Searching for a way to guide a confused market on measuring the value of illiquid liabilities, the Financial Accounting Standards Board wrestled last week yet again with how exit prices should be used to determine the fair value of liabilities.

FASB met last week to hammer out revisions to its proposed guidance in FASB Staff Position No. 157-c, Measuring Liabilities under FASB Statement No. 157. FAS 157 is the new standard on fair-value measurement that says companies should mainly rely on market activity, not their own transactions, to determine the fair value of assets and liabilities where it is required throughout ...