Mr. Cormac Butler:

In essence, when the accounting profession devised accounting standard IAS 39, it claimed that within it is a rule that states one can delay the recognition of losses.

This is because the banks were sometimes overestimating their losses and it was thought that if that uncertainty was removed altogether, it could solve the problem. A much bigger problem, however, has been created. Second, although that paragraph is in the guidance notes of IAS 39, it was not approved by the European Union. This is the law they use but that paragraph was not approved by the European Union.