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Valuation problems financial assets: Apples and Oranges

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I have an issue of not always capturing the point being made in particular articles. Can you kindly summarize the main points being made in the article "Apples and oranges" (http://www.economist.com/blogs/schumpeter/2013/03/accounting)?

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This article discusses valuation problems with financial assets held by banks. Your summary is 315 words and indicates the basic issues and what the controversy is about.

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This article discusses serious valuation problems with financial assets held by banks. The financial crisis revealed that bank assets are often worth far less than what was reported on the financial statements and so the standard setters in the US and international communities are attempting to improve the valuation model to be less misleading.

The valuation options include marking-to-market, recording a loss reserve or recording at historical cost (book value). Marking to ...

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  • MSc, University of Virginia
  • PhD, Georgia State University
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