Critics argue that the “fair value” provisions in U.S. accounting rules exacerbated the recent financial crisis by depleting banks' regulatory capital, which curtailed lending and triggered asset sales, leading to further economic turmoil. Defenders counter-argue that the role of fair value...

The value of information incorporated by fair value measurements into financial statements, as compared to that provided by historical cost accounting, is considered to constitute one of its vital advantages -- such value having attributes of complete and accurate information.However, problems...