The article explores the economic benefits and costs of fair value accounting in European banks. The researchers conducted three essays to analyze different aspects of fair value accounting. The first essay looked at how recognizing changes in credit risk affects information for investors. The second essay studied how investors reacted to reclassifications of financial assets. The third essay examined how fair value accounting influences audit fees for banks. Overall, the research shows that fair value accounting can impact information for investors and audit fees for banks in Europe.