Moving towards Fair Value Accounting
In the past, historical cost measures were mainly used for reporting as they are reliable. However, historical cost is only relevant upon acquiring the asset and becomes irrelevant as time passes. On the other hand, fair value-based reporting, which accounts for changes in fair values, can produce balance sheet figures that provide a better reflection of the company’s value. This is also why accounting bodies are moving towards fair value accounting (FVA).
One of the evident standards is the FASB Standard (SFAS) 157, ‘Fair Value Measurements’, to establish clear, consistent guidelines for fair values measurements and disclosures. SFAS No. 133, ‘Accounting for Derivative Instruments’ and IAS 39 also require entities to account for changes of fair value of derivatives depending on its use. SFAS No. 159, ‘Fair Value Option for Financial Assets/ Liabilities was adopted on February 07 to allow financial institutions to elect specific HTM......

Join Now to view the rest of this term paper!
Members: Login to view this research paper.

Title: Fair Value Accounting
Approximate Word Count: 2045
Approximate Pages: 9 (250 words per double-spaced page)

With the Term Papers Lab Membership Pass, you get instant access to every essay on this site, including this essay on Fair Value Accounting, for as long as you remain a member.

Other essays sites charge almost $100 for a single term paper. At Term Papers Lab, you can get instant access to over 100,000 research papers for as little as $29.95!