The European Commission's Accounting Regulatory Committee is to meet today in Brussels in another attempt to break the impasse over the new International Accounting Standard (IAS) 39.
European banks are concerned that the new standard will create volatility in the marketplace because it may confuse investors by affecting how results are presented.
The Irish Banking Federation wants the Commission to adopt the new international accounting standards, due to come into effect in January 2005, but to exempt banks from IAS 39 until the difficulties banks have with the measure can be resolved.
The disputed bookkeeping rule requires banks to carry financial instruments such as shares, bonds and derivatives at market value in their accounts rather than historical costs, to increase transparency in the balance sheets. The proposed new practice is commonplace in the United States.
The commission is proposing that a "carved out" version of IAS 39 be adopted, with the more controversial elements being removed.
However, the Irish Banking Federation said this may result in a "dangerous precedent" for the creation of a Europeanised set of standards.
Should the commission fail to resolve the impasse this month, then the issue is likely to be one of those on Mr McCreevy's desk when he takes up his new role as Commissioner for Internal Affairs later this year.
