FASB adopts fair value option for financial instruments

The United States Financial Accounting Standards Board (FASB) has issued Statement 159 The Fair Value Option for Financial Assets and Financial Liabilities (FAS 159). The new standard provides companies with an option to report selected financial assets and liabilities at fair value. It also establishes presentation and disclosure requirements designed to facilitate comparisons between companies that choose different measurement attributes for similar types of assets and liabilities. FAS 159 is effective for an entity's first financial year beginning after November 15, 2007, with earlier adoption permitted. The FAS 159 fair value option is similar, but not identical, to the fair value option in IAS 39 Financial Instruments. For more information, view the FASB News Release.