1. Relevance and reliability are the cornerstones of the IASB’s approach to financial reporting, but it is very cornerstones that could be compromised by the use of mark-to-model calculated “fair values”.2. In spite of their frequent lack of reliability, and questionable status as surrogates for real commercial transactions, all movements in calculated fair values from one balance sheet to the next are likely to be regarded as components of a company’s performance, with the result that changes in calculated fair values translate directly into performance gains and losses.3. The IASB has a responsibility to define clearly the boundaries between fair value information that is sufficiently reliable to be incorporated in the primary financial statements, and supplementary fair value information to be provided in the notes to the account in the form of ranges of possible outcomes and sensitivity analyses.
