Rep. Richard Baker will hold an Oct. 1 hearing on the Financial Accounting Standards Board's controversial derivatives proposal.

"The hearing will give those with different perspectives on the FASB draft standard a chance to be heard before the final rules go into effect," the Louisiana Republican said Thursday.

The standards board plan would require companies to report derivatives at fair market value on quarterly income statements. Banks and other companies that use derivatives have complained that the accounting rule would distort earnings.

However, FASB Chairman Edmund L. Jenkins repeatedly has said it provides investors with important information and that the rule would take effect by Jan. 1, 1999.

Officials from FASB, the Securities and Exchange Commission, the banking agencies, and the industry will be invited to testify. FASB officials will be asked to describe the process used to draft the rule, said Rep. Baker, who is chairman of House Banking's capital markets, securities, and government-sponsored enterprises subcommittee.

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