The profitability and net worth of companies and banks are s

The profitability and net worth of companies and banks are set to see a drastic change in April 2010 as they prepare for adopting international accounting norms a year later. The acquisitions made by companies, derivatives held by them, stock options issued by them and errors noticed on previous financial statements are going to be major areas in which balance sheets of companies and banks will witness a lot of changes. In some cases, their reserves and net worth might go down significantly as they adopt the principle of fair valuation of financial and physical assets in place of the current practice of showing their actual cost of purchase, which may not show their real market value.