Treasury Under Secretary John D. Hawke Jr. is urging the Federal Accounting Standards Board to exempt certain securities from its controversial derivatives proposal.

Under the FASB plan, securities with values that fluctuate relative to inflation would be treated as instruments with derivatives embedded in them. This would require these so-called inflation-indexed securities to be accounted for in an unnecessarily complicated way, Mr. Hawke noted in an Oct. 14 letter to the accounting board.

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