Mr. Alan Merriman:

-----elaborate on it. He said:

I don't think the financial reporting of the losses was linked to the presence of the underlying causes of the crisis [He's clearly absolutely right]. The losses reported, whether in any particular period, are a consequence of the factors that caused the crisis, they didn't cause the crisis and I think that's a very important point.

So let me just put it very simply. IAS 39 was about how much loan loss provision you could recognise on your balance sheet or in your profit and loss account. It is has no impact on, "Do you have a bad loan or do you not have a bad loan?" The bad loans were written. They were there regardless of what the accounting standard would say. If management in any bank or any building society felt that the loan loss provisions under IAS were shy or weren't appropriate, it was open to management to share that through voluntary disclosure or other data. So, tables giving statistics on loan defaults, tables giving insights about future expected losses, they were all open to banks, regulators, everybody, to try and get that type of information. IAS is a red herring.