A simmering row between the European insurance industry and European Union regulators over the impending International Financial Reporting Standards (IFRS) has erupted in the open. The chief EU financial regulator has announced talks to find a compromise to a disagreement over the insistence of the International Accounting Standards Board (IASB) that the “fair value” standard must not be tampered with.

The new standard is one of a series that will come into effect on January 1 next year (Australia will switch across to the IFRS at the same time). Frits Bolkstein, the Commissioner for the EU’s internal market, taxation and customs union, has told a conference in London that a high-level committee will try to find areas of compromise between the insurers’ and IASB’s viewpoints.

Fair value accounting forces businesses to record the value of their assets and liabilities in present-day dollars, rather than as projected values. It’s a calculation that has been opposed by insurers for at least the past 10 years.

Reports from Europe reveal a high level of opposition by insurers and reinsurers to the fair value rule. But most observers also believe the IASB is unlikely to give ground on the measure, with one high-level EU source saying the committee won’t be able to find a solution in the limited time available.