Japan orders audit of the account

Posted by Yuka as Japan

Japan should change the market, accounting rules, if it is determined
that the current rules a “systemic risk” for the markets, the finance
minister said Friday, calling regulators to delay a test.

“I’m very interested in this issue, and I want to come to a conclusion
as soon as possible,” said Shoichi Nakagawa at a press briefing in
Tokyo.

Nakagawa of the declaration comes after the Heads of
State and Government of the European Union, the relaxation of the rules
market, the so-called fair value accounting of the companies which are
monitored regularly, the plants and the ratio of losses from the values
of the decline. The Securities and Exchange Commission is preparing a
revision of the current practice in the United States.

Economic and Fiscal Policy Minister Kaoru Yosano also said, Friday, the
government has no other choice than to consider “whether the rules
governing the accounting should be reviewed, taking into account the
violence of ups and downs on the stock and other financial markets.

“It is highly unusual that (the Nikkei Stock Average) is moving upwards and downwards over 10 percent,” Yosano said.

When the market, the rules are strictly applied, “it would be difficult
for (some) in the regional capital base their figures of assets, which
it loans,” said Yosano, without development.

Reviewers to say
mark the rules of the market is forcing companies to take into account
that they do not expect suspends losses, making the recent crisis on
world markets. Tell resources of the state to provide investors with
accurate information about the actual value of a fund company.

“The verdict just a book of the system may include a” black box “to
hide the losses to investors what they still nervous,” said Nana
Otsuki, bank analyst at UBS Securities Japan Ltd. “It may be useful as
an emergency measure. But it should not be confused with long-term
effects, he can not improve Japanese corporate balance sheets, even if
they can improve the investors’ feeling. ”

Former leader of
the United States not to the insurer American International Group Inc.,
told Congress this month the rule forced the company to book losses
plight title mortgages and credit-default swaps.

The Council
of accounting standards in Japan on Thursday ensures that discussions
on market changes to the rules from abroad and the opinions of markets,
while the Financial Services Agency Commissioner Takafumi Sato said he
will continue to discuss in accounting standards.