We continue to see news stories about charges of earnings manipulation, even under the historical cost accounting framework. We believe that, without reliable fair value estimates, the potential for misstatements in financial statements prepared using fair value measurements will be even greater. Verification As the variety and complexity of financial instruments increases, so does the need for independent verification of fair value estimates.
However, verification of valuations that are not based on observable market prices is very challenging. As I mentioned, many of the values will be based on inputs and methods selected by management. Estimates based on these judgments will likely be difficult to verify.