The Mixed Accounting Model under IAS 39: Current Impact on Bank Balance Sheets and Future Developments

Accounting for financial instruments is based on a combination of fair value and amortized cost measurement. This paper examines how IAS 39’s mixed accounting model is reflected in measurement and presentation choices of international banks and how those choices will be altered by future regulation...

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Bibliographic Details
Published inJournal of Financial Transformation Vol. 31; pp. 165 - 172
Main Authors Bischof, Jannis, Ebert, Michael
Format Journal Article
LanguageEnglish
Published Capco Institute 2011
SeriesJournal of Financial Transformation
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Summary:Accounting for financial instruments is based on a combination of fair value and amortized cost measurement. This paper examines how IAS 39’s mixed accounting model is reflected in measurement and presentation choices of international banks and how those choices will be altered by future regulation (IFRS 9 and Basel III). Potential problems arising from the approach taken by the IASB, such as earnings management or biases in investor perception, are identified and discussed.