Companies could be forced to develop a 'parallel' balance sheet to reveal exposure to vehicles kept off their formal financial statements under proposals being discussed by accounting standard setters. Financial Times

The International Accounting Standards Board is due to publish a consultation paper – the first public step in its standard-setting process – later this year.

Off-balance sheet accounting practices have been criticised for their role in the credit crunch where they are blamed for potentially obscuring the true risks banks face.

A number of leading banks, including Citigroup and HSBC, have announced they will be bringing structured investment vehicles back on to their books as a result of the market turmoil, sparking questions as to whether they should have been allowed to use the special accounting treatment in the first place. SIVs issue cheap, short-term debt to fund investments in longer-term and higher-yielding securities.

The project was launched before the credit crunch began and technical staff are discussing the issue internally.