FASB OKs Simplified Proposal on Derivatives

The Financial Accounting Standards Board has voted to simplify its controversial rule proposal on derivatives accounting without changing its main thrust. The professional body’s proposal would require companies to report derivatives in their financial statements at current market value rather than in footnotes and at historical cost. It seeks to increase investor access to data that, the board says, would give a clearer picture of what these sometimes-volatile securities are worth. Earlier this week, FASB named Edmund L. Jenkins, a former partner at Arthur Andersen, as chairman to replace Dennis Beresford, who is retiring this month after 10 years in the post. The FASB writes accounting rules for use by the private sector.