Perhaps tipping its hand on how the fair-value fight is going, a key trade group is shifting the industry's line of attack.
Having already argued that it's bad for banks and bad for investors, the Financial Services Roundtable is now asserting that a controversial proposal from the Financial Accounting Standards Board is bad for the FASB itself.
Expanding the use of fair-value accounting in the U.S. would not just conflict with convention in other parts of the world — it would jeopardize the FASB's other stated goal of converging U.S. and international accounting standards, the Roundtable wrote in response to the FASB's request for public comment on its proposed rule.
The it's-bad-for-FASB argument "is based on the lack of success of the preceding arguments," which have included entreaties to consider the logistical and financial impact that the proposal would have on the banking system, Scott Talbott, the trade group's senior vice president of government affairs, said in an interview. "So far everything else has fallen on deaf ears."
The letter, one of more than 200 filed since the comment period began three months ago, also flags the group's objections on policy and practicality grounds. But the main thrust of the letter is to hit the FASB where it hurts.
It reminds the FASB that converging its rules with those of its London counterpart, the International Accounting Standards Board, is a goal that has been endorsed by the Group of 20, an increasingly influential forum for central bankers and financial ministers of major economies. And it ends with this flourish below the signature line: "cc. Sir David Tweedie, chairman, IASB."
