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By Emily Chasan and Rachelle Younglai

NEW YORK/WASHINGTON, Sept 29 (Reuters) - The Financial Accounting Standards Board, which sets U.S. accounting rules, is in discussions with the U.S. Securities and Exchange Commission about whether more guidance on fair value accounting rules is needed, a person familiar with the matter said.

Additional guidance related to the accounting rule, known as FAS 157, may or may not result from the discussions, the person said.

Fair value, or mark-to-market accounting requires financial firms to value assets based on what they could fetch in a current market transaction. New rules requiring broader use of the standard have been partially blamed for forcing banks to take big write-downs on the values of assets affected by the credit crunch.

SEC spokesman John Nester said the agency is "working closely with U.S. and international regulators and standard setters on the issues related to fair value."

It was unclear whether the SEC and FASB would issue guidance before the end of the third quarter, which ends on Tuesday.

Mark-to-market rules, which require companies to disclose more about the market values of their investments took full effect this year, reversing the prior practice of recording many asset values at historical cost. As credit markets tightened over the past year and asset values plunged, financial firms have been forced to take billions in write-downs due to the change.

Financial services companies, in particular banks, have been pressing the SEC to provide guidance.