Accounting practices have moved up the Financial Services Authority's (FSA) agenda since the start of the banking crisis, it has been revealed.
Speaking at the British Bankers' Association Annual Conference, Lord Adair Turner, chairman of the FSA, explained that the credit crunch had led the body to rethink they way it goes about its work.
He said: "We are now involved to a much greater extent than a year ago in the granular analysis of balance sheets, accounting practices and valuation approaches."
Detailed stress tests are also being used by the FSA to see if banks and building societies will be able to meet its capital adequacy standards over the next five years, Lord Turner added.
However, the authority has already revealed that it will not be following in the footsteps of US regulators by releasing the details of such tests.
The FSA pointed out that stress testing is not a forecast of future performance, so there is little public interest in issuing the data.
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