Demystifying Mark-To Market

Accounting rules do not by themselves put firms into financial dire straits. But they can make it tough to dig out.

It’s not often that an accounting rule gets as much press or as much attention from politicians as the mark-to-market” or “”fair value”” rule has gotten in the past several months. Active readers of the business news have probably grasped the basics of the controversy: Is it possible an accounting rule that requires banks and other financial companies to write down the value of certain investments to “”fair value”” is causing financial institutions to fold?