Federal Reserve Board Governor Susan M. Phillips said Thursday that the central bank is developing best-practices guidelines for internal and external audits.

Ms. Phillips, during an address at the University of Tennessee- Chattanooga, said the Fed hopes to distribute the guidelines next year. She did not discuss what the guidelines would include.

Ms. Phillips urged the Financial Accounting Standards Board to complete work on proposals governing credit derivatives and net deferred losses/gains on derivatives used for hedging.

"We hope that accounting guidance will be finalized soon in these areas, at which time we may have to revise our regulatory reporting requirements," she said.

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