Banking


Although there is no evidence banks are abusing “special purpose entities” to inappropriately move liabilities off their balance sheets, Mark W. Olson, a Federal Reserve Board governor, says the Fed is working with banking regulators to prevent such practices. According to Olson, when financial institutions retain substantive risks associated with assets they’ve moved to special purpose vehicles, banking regulations require them to consolidate those assets in publicly available GAAP-compliant financial statements. He added that the Fed retains—and has exercised—the right to apply its own rigorous interpretation of GAAP to such statements to ensure their accuracy. ( www.federalreserve.gov/boarddocs/speeches/2002/20020207/default.htm )

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Test yourself on these often confused words

The spelling checker on your word processing program can do only so much to flag problems. Your best insurance is to learn the troublesome words that trip up writers and use them correctly by the standards of formal, written English.