Update: FASB to Change Mark-to-Market Rules

Randall C. Smith, Managing Editor

The Federal Accounting and Standards Board today announced a change in accounting rules that allows companies to use their judgment when determining fair value of an asset on their books. The changes will take effect for the second quarter of 2009.
The credit union lobby has pushed hard for this change along with the banking community. This is good news for CUs because it allows credit unions to value their assets at what they could sell for in an orderly sale where existing rules forced credit unions to take losses during economic downturns due to the fact that the investments had to be valued lower.