THE ACCOUNTING Standards Board (ASB) is reconsidering its controversial method for reporting pension deficits, though it says it is "not flawed", according to this morning's papers.
The ASB, which is responsible for the accounting standard FRS17 - which forces companies to outline pension deficits on their accounts - said despite the criticism it thought it was "a good standard,” says the Daily Telegraph.
Ian Mackintosh, ASB chairman, said questions had been asked on whether some of the requirements were quite right. The FRS17 accounting standard was first published in November 2000, and drives the calculation of pension deficits, or less frequently surpluses, in company accounts.
Pension black hole publicity has had a damaging effect, and helped to fuel the pension crisis, said Mike Warburton of accountants Grant Thornton. He said: "This was introduced at a time when the stock market was depressed, and added to the pain. It highlighted the scale of pension deficits and further depressed the share price of many publicly quoted companies, in which other funds were invested. It became a vicious circle."
A CRISIS in the world's hedge fund industry was in prospect last night after one of the world's largest derivatives brokers was forced to freeze trades potentially worth billions of pounds, reports the Guardian./p>
The move by Refco, which acts for many leading speculative investors both on Wall Street and in the City, followed the discovery of accounts irregularities at the firm earlier this week and the issue of fraud charges against its former chief executive Phillip Bennett.
Bennett has been charged with defrauding investors by using a hedge fund to hide $430m (£250m) of debts owed to the firm. A British banker who has lived in the US since 1978, he has been released on bail of $50m secured on a house in New Jersey, a Park Avenue penthouse apartment, $5m in cash and funds raised by six co-signers of the bail bond.
CHANCELLOR GORDON Brown yesterday refused to rule out raising taxes after economists warned of a £10bn black hole in the country's finances, according to the paper.
Brown will, next month, face the embarrassment of telling the Commons that his forecast for economic growth this year was far too optimistic and that the UK is not doing as well as he had hoped.
He had forecast growth this year of 3 to 3.5%. But a report this week by the Organisation for Economic Co-operation and Development (OECD) said GDP growth in 2005 is likely to be 1.7%, substantially below its previous forecast in June of 2.4%.
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