Glas Cymru's proposals will cut Welsh Water's cost of capital, its single biggest cost (accounting for a third of customers' bills).

ECONOMIST: Great age

Because all banks except Bank of Tokyo-Mitsubishi have now chosen historical cost accounting, however, all will report capital levels greater than the 8% minimum.

ECONOMIST: Japanese banks

Therein lays one of the key shortcomings of traditional accounting: there is no allowance for a change in the cost of capital in the accountant's methodology, even though it is incredibly relevant to an asset's value.

FORBES: The P/E Problem

That is, the benefit to the capital market of improved financial information must be weighed against the cost of any changes in economic behavior induced by new accounting rules.

FORBES: Why Everybody's Jumping On The Accountants These Days