Mark-to-market accounting has merit, but financial institutions need better clarity on its application for very distressed assets,
Cox, speaking at a conference of accounting professionals, stopped short of calling on the
The SEC is finishing up a congressionally mandated studydue Jan. 2which examines the impact of mark-to-market accounting on financial institutions' balance sheets.
"The work we have already done suggests that the accounting standard-setters could improve upon the existing security impairment models," Cox told the
"Investors have clearly indicated a view that the current concept of mark-to-market accounting increases the transparency of financial information provided to investorsbut that in inactive or illiquid markets, additional guidance would be useful to promote reasonable application of the standards."