IASB exposure draft on the fair value option – ACT response

The ACT has submitted a response to the IASB’s exposure draft EC/ 2010/4 on the fair value option for financial liabilities

The IASB has proposed that for liabilities designated under the fair value option any changes in valuations arising from changes in the credit risk of the liability should not affect profit or loss. The ACT supports this overall approach save that we differ in that we would recommend that realised gains and losses should be recycled from Other Comprehensive Income to profit or loss.