The Financial Accounting Standards Board issued a proposal on fair value measurements last week, in response to constituents' requests for improved guidance on the subject. The 109-page document is intended to establish a framework for measuring fair value that would apply to financial and nonfinancial assets and liabilities, thereby making the measurements more reliable and consistent. The Exposure Draft would replace any current guidance for measuring fair value in previous Board pronouncements.

Seidman

The Exposure Draft also would expand current disclosures about the use of fair value to measure assets and liabilities, focusing specifically on the methods used for the measurements and the periods to which they apply. According to FASB member Leslie Seidman, "The proposed disclosures should help investors evaluate the extent of fair value being used presently in the financial statements and the effect on earnings." Comments are due by Sept. 7, and the Board will hold a public roundtable in September to gather additional input.

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