The financial and banking crisis of the late 2000s prompted claims that the incurred-loss method for the recognition of credit-losses had caused undesirable delay in the recognition of credit-loss impairment. In the wake of the crisis, the U.S. Financial Accounting Standards Board (FASB) and the...

This paper outlines the work of the FASB and the IASB on the development of expected-loss methods for measuring the impairment of financial instruments arising from credit losses, and describes and compares key features of the different approaches developed by the two standard setters. It also...

This paper outlines the work of the FASB and the IASB on the development of expected-loss methods for measuring the impairment of financial instruments arising from credit losses, and describes and compares key features of the different approaches developed by the two standard setters. It also...

Banks, financial statement users, and accounting standard setters have long disagreed on the informativeness of banks' statements of cash flows (SCFs) and there is a lack of relevant evidence in the literature. This paper examines the informativeness of the SCFs of U.S. commercial banks in two...

Banks, financial statement users, and accounting standard setters have long disagreed on the informativeness of banks’ statements of cash flows (SCFs) and there is a lack of relevant evidence in the literature. This paper examines the informativeness of the SCFs of U.S. commercial banks in two...

Following Basu (1997), the excess of the sensitivity of accounting earnings to negative share return over its sensitivity to positive share return (the Basu coefficient) has been interpreted as an indicator of conditional accounting conservatism. Although this interpretation is supported by...

From 2005, IAS 39: Financial Instruments: Recognition and Measurement required UK banks to support loan-loss provisioning with objective evidence that losses had been incurred, and thereby eliminated general loan-loss provisioning. It has been argued that the IAS 39 incurred-loss method of...

Following Basu (1997), the difference between the sensitivity of accounting earnings to negative equity return (proxy for bad news) and its sensitivity to positive equity return (proxy for good news) is interpreted as an indicator of conditional accounting conservatism. However, there is concern...