In the wake of the 2008 financial crisis, conflicting arguments have been made about fair value accounting versus historical cost accounting and the role that each played in the crisis. This report examines the relationship between both types of accounting practices and systemic risk in the financial sector, providing recommendations on how FVA and HCA can both be improved.
Pages
108
Format
Paperback
Publisher
RAND Corporation
Release
October 15, 2013
ISBN
0833082124
ISBN 13
9780833082121
Fair Value Accounting, Historical Cost Accounting, and Systemic Risk: Policy Issues and Options for Strengthening Valuation and Reducing Risk
In the wake of the 2008 financial crisis, conflicting arguments have been made about fair value accounting versus historical cost accounting and the role that each played in the crisis. This report examines the relationship between both types of accounting practices and systemic risk in the financial sector, providing recommendations on how FVA and HCA can both be improved.