The financial crisis that hit the global economy since 2008 has led to severe attacks against IFRS including from the CEO of AIG and Dexia or AXA. The latter believe that the application of IFRS 7 on the valuation of financial assets at fair value causes significant impairment recognized by companies facing bankruptcy.
The combination of IFRS and Basel II rules for financial institutions lead to anomalies. Prudential banking rules are based on measuring instruments, no filter. The result is a devastating procyclical in times of crisis that requires thinking to restore the consistency of the two references.
According to Philippe Danjou and Gilbert Gelard, IASB members, they believe the contrary that the application of IFRS displays state and nature of the crisis.
They even add that the methodology of fair value is certainly the worst system if we exclude all other methodologies. Finally, they state that the crisis of confidence affecting the financial markets will largely be exceeded once there is improved transparency and increased disclosures.
However, a problem arises in less liquid markets, where there are few transactions.
To solve this problem, the Board of the IASB established a panel of financial experts between May and August 2008 to determine the best criteria to pass the value of market and financial models. A consensus appeared at that time on the IASB website.