The Group of 20 nations should resist pressure to relax an asset-valuation rule blamed for worsening the global credit crisis, the Financial Accounting Foundation said in a letter to President George W. Bush.

``We are very concerned about recent efforts in the United States and abroad that contemplate political solutions to perceived flaws in certain accounting standards,'' Chairman Robert Denham wrote in a letter yesterday before a G-20 summit in Washington. Legislation would ``dangerously compromise the credibility of financial reporting,'' said Denham, whose foundation oversees the Financial Accounting Standards Board.

The so-called fair-value accounting rule forces firms to mark down holdings to current trading prices quarterly, which companies including American International Group Inc. (AIG) say makes no sense when markets seize up. Proponents, including Norwalk, Connecticut-based FASB, say fair-value adds to transparency and gives investors information about publicly traded companies.

The non-government International Accounting Standards Board, under pressure from European banks and elected officials, altered its fair-value provision Oct. 13. The change lets lenders reclassify some of the investments to avoid the requirement.

The IASB, which writes rules used in more than 100 countries, ``departed from its normal due process'' to make the revision, Denham said. The G-20, which is meeting for two-day summit starting today, should ``support independent standard- setting via a robust due process free from political interference.'' The G-20 leaders will consider common standards for accounting, Bush said in a New York speech yesterday.

The U.S. Securities and Exchange Commission, which can override FASB, should reject calls to suspend fair-value, Denham said in an Oct. 28 letter to Chairman Christopher Cox. FASB should be free from outside pressure and should consider changes to the rule in an ``independent and deliberative manner,'' Cox said the next day at public discussion on fair-value.

To contact the reporter on this story: Ian Katz in Washington at ikatz2@bloomberg.net.

To contact the editor responsible for this story: Otis Bilodeau at obilodeau@bloomberg.net