Correspondence: Alfred M. King, Vice Chariman of Marshall & Stevens, Inc., 11102 Fawn Lake Parkway, Spotsylvaina, VA 22551-4667, USA. Tel: +1 540 972 4704; E-mail: aking@marshall-stevens.com

¹is Vice Chairman of Marshall-Stevens, one of the largest independent valuation firms, with an international practice. He has had 40 years of experience in valuation and has personally valued over $100bn of assets. A graduate of Harvard College and Harvard Business School, Mr King has consulted expensively with major public firms as well as numerous private companies. He has testified extensively before the FASB, SEC and other regulators.

Received 16 May 2008; Published online 3 July 2008.

EXECUTIVE SUMMARY

The World Economy is going through a true revolution in financial reporting. Rather than show assets on corporate balance sheets at their original historical cost, companies are being required to determine, and then report, what those assets are worth today. The current term for this new wave of financial reporting is 'Fair Value' accounting. Fair Value reporting is being pushed in the name of transparency. In the author's opinion Fair Value accounting is likely to be neither relevant nor reliable, two of the requirements for financial reporting.