Inflation accounting was practiced in the US by the American Institute of Certified Public Accountants for over 50 years. During the period of Great Depression many companies reconstructed their financial reports recording the inflation in them. During those 50 years many companies were encouraged to record the price-level adjusted statements in place of cost-based financial statements. The FSAB or the Financial Accounting Standards Board raised a proposal of publishing the price-level adjustment statements which was withdrawn by them later due to certain problems.
Historical accounting replaced fair value accounting during the 1930s post Great Depression period. This was replaced since the values had been overstated by certain companies. The principles of historical cost accounting came into being post Wall Street Crash which took place in 1929 along with the assumption of stable currency.