Mark-to-Market Accounting: Does it Provide Information to Investors
The Journal of Applied Business Research
According to the financial press the recent financial problems of many firms is at least partially due to mark-to-market accounting. In this paper I ask the question -- if mark-to-market accounting is the reason for the financial distress of firms, why does the FASB require mark-to-market? I review accounting standards that require mark-to-market accounting and empirically test the relation between firm value and mark to market adjustments to provide evidence as to whether mark-to-market adjustments are useful to investors and creditors. The results provide evidence that mark-to-market adjustments impact firm value.
"Mark-to-Market Accounting: Does it Provide Information to Investors."
The Journal of Applied Business Research, 25 (6): 119-124.