Record Details

FAIR VALUE ACCOUNTING AND ITS IMPACT ON BANKING SECTOR STABILITY

Research Journal of Economics, Business and ICT

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Field Value
 
Title FAIR VALUE ACCOUNTING AND ITS IMPACT ON BANKING SECTOR STABILITY
 
Creator Hájek, Petr; Unicorn College, Prague and Central Bohemia University
Alimbekova, Gaukhar; Al-Farabi Kazakh National University
Baydildina, Adilya; Al-Farabi Kazakh National University
Adambekov, Nurbek; Turar Ryskulov New Economic University
Amonov, Kholnazar; Central Bohemia University
 
Subject Economic topic
SFAS 157, SFAS 159, Mark to Market rule, Banking crisis, Fair Value Accounting
M41, M48
 
Description In 2007 two rules SFAS 157 and SFAS 159 were adopted into fair value accounting scheme just into looming financial crisis. These rules had high pro-cyclical effect and significantly affected banking sector stability during the recession and its “profitability” during the years after the recession. Important parts of these rules were relaxed in April 2009 and then some other suspended in January 2016. First, FASB let the companies to use whatever valuation methods to value balance sheet securities in terms of fair value accounting they considered best within the SFAS 157 framework. Second, FASB scraped Debt Value Adjustments, part of SFAS 159, from income statements watched most by investors. This article reviews the implications of mark to market rules, its pro-cyclicality and impact on banks’ balance sheets.
 
Publisher English Time Schools & Overseas Education
 
Contributor —
 
Date 2015-12-30
 
Type info:eu-repo/semantics/article
info:eu-repo/semantics/publishedVersion
Peer-reviewed Article
 
Format application/pdf
 
Identifier http://ojs.journals.cz/index.php/RJEBI/article/view/715
 
Source Research Journal of Economics, Business and ICT; Vol 10, No 2 (2015)
2047-7848
2045-3345
 
Language eng
 
Relation http://ojs.journals.cz/index.php/RJEBI/article/view/715/659
 
Rights Copyright (c) 2016 Petr Hájek, Gaukhar Alimbekova, Adilya Baydildina, Nurbek Adambekov, Kholnazar Amonov
https://creativecommons.org/licenses/by/3.0/