American bankers are not the only ones crying for help under controversial new fair-value accounting requirements; European financial institutions, fearful of downward valuations of securities, have some grievances of their own.
One factor has been the European Union’s reluctance to accept the mark-to-market principle, the fundamental pillar of fair-value accounting. In Europe, that concept is housed in International Accounting Standard No. 39, Financial Instruments: Recognition and Measurement. It is the EU counterpart to the U.S. Financial Accounting Standard No. 157, Fair Value Measurement.
