Archive Links

Consumer Archive
CU System Archive
Market Archive
Products Archive
Washington Archive

News Now

CU System
International body wants CUs fair value comments
MADISON, Wis. (1/26/10)--The International Accounting Standards Board (IASB) is seeking clarification from credit unions and other financial services providers in emerging and transition economies on fair value measurement issues as described in the current International Financial Reporting Standards (IFRS) draft. The move is in response to issues raised by global financial organizations, including the World Council of Credit Unions (WOCCU). WOCCU is asking its member organizations to share examples of situations in which the requirement to use fair value accounting may be impractical for credit unions. Last September, WOCCU submitted a comment letter to IASB supporting the board’s reassessment of fair value measurement in light of the ongoing global economic recession. WOCCU specifically raised issues on the unintended consequences the standards may have had on some financial cooperatives and their restrictive influence on institutional mergers. IASB last week contacted WOCCU and other organizations and asked for input, specifically “examples and case studies of transactions or situations ... that would make the fair value measurement guidance as proposed in the exposure draft impractical.” “We're pleased IASB is reconsidering its position and has come back to WOCCU requesting information to help it craft a better standard,” said Dave Grace, WOCCU vice president of association services and author of September's letter. “I am asking our entire membership for examples in which fair value standards have proven impractical for credit unions.” In its response to WOCCU, IASB cited concerns that:
* The proposed fair value measurement guidance is not detailed enough to allow IASB to develop fair value estimates on a consistent basis; * There is limited availability of practitioners with sufficient skills to apply necessary guidance, resulting in difficulties in applying critical judgments to affected entities; * There is limited access to market data to develop fair value measurements because there are few deep and active markets, few willing buyers and sellers and prices often fluctuate considerably; and * Developing fair value estimates and preparing the resulting disclosures can be expensive.
Final comments are due to IASB Sunday, after which the board will evaluate and consider amending inadequate proposals in the exposure draft and issuing educational materials covering application of the fair value measurement principles. All WOCCU member input should be submitted to Grace by e-mailing by Thursday. IFRS does not apply to U.S. credit unions, which use the Generally Accepted Accounting Principles (GAAP). For IFRS to apply to U.S. credit unions, it would take a statutory change to the Federal Credit Union Act, said the Credit Union National Association.
Other Resources

RSS print
News Now LiveWire
HFSC Chairman @RepHensarling announces subcommittee chairs for #114th Congress:
4 hours ago
Don't Mullet Over: Check out @ECCU1's meme-rable campaign that brought in $8M in loans #NewsNow
6 hours ago
#FOMC minutes show committee members debated erasing 'considerable time' from forward guidance #NewsNow #Market
8 hours ago
NCUA votes 2 to 1 to approve 2015 budget: McWatters is dissenting vote.
9 hours ago
.@TheNCUA bd mmber McWatters at #NCUAbdmeeting invited specific, detailed comments on budget/budgetary process to be sent directly to him.
10 hours ago