The Financial Accounting Standards Board has proposed a rule change to make it harder for companies to use repurchase agreements to move debt off their balance sheets. This form of short-term borrowing, called "repo accounting," was used by MF Global to keep sovereign debt off its books. "What the FASB has proposed has significant potential to close the accounting loophole that MF Global exploited," says Bruce Pounder of SmartPros. The FASB is seeking comments by March 29.
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