Bank One Corporation - Page 130

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          We find neither of these requirements in the definition of “fair            
          value” as set forth in SFAS No. 107.  Nor are we able to conclude           
          on the basis of the record that either of these requirements has            
          been imputed into that definition under SFAS No. 107, or, in                
          fact, into the accountant’s definition of that term in general.66           
               Our understanding of the difference between these two terms            
          is further reinforced by additional testimony from Sziklay.  He             
          concluded that                                                              
               Fair market value for income tax reporting purposes is                 
               related to, but not the same as, fair value for                        
               financial reporting purposes which is directed to the                  
               needs of financial statement users.  The former is                     
               encompassed in the latter.  I have not read anything in                
               the trial record, expert reports, the Internal Revenue                 
               Code, Treasury regulations, Revenue Rulings, Revenue                   
               Procedures, federal tax cases, etc. to suggest that                    
               fair market value for income tax purposes must conform                 
               to fair value for financial reporting purposes for the                 
               purpose of marking-to-market * * * [FNBC’s] portfolios                 
               of derivative securities.                                              
          He testified further that “the term, fair value, for accounting             
          purposes is a broader term than fair market value for tax                   


          66 For purposes of financial accounting, the term “fair                     
          value” denotes primarily:                                                   
               1.  Value determined by bona fide bargain between                      
               well-informed buyers and sellers; the price for which                  
               an asset could be bought or sold in an arm’s-length                    
               transaction between unrelated parties; value in a sale                 
               between a willing buyer and a willing seller, other                    
               than in a forced or liquidation sale.                                  
               2.  An estimate of such value, in the absence of sales                 
               or quotations (e.g., the approximation of exchange                     
               price in nonmonetary transactions).  [Kohler’s                         
               Dictionary for Accountants 211 (6th ed. 1983).]                        




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