In this is both a fortran and a libfortran problem.

Take the following code and try to run it and you will get an internal error:
module mymod
contains
  function mystring ()
    character(len=4) :: mystring
    write (unit=mystring,fmt='(A)') 'aaaa'
  end function mystring
end module mymod

program main
  use mymod
  write (unit=*,fmt='(A)') mystring()
end program main

-- 
           Summary: Recursive IO functions are not allowed
           Product: gcc
           Version: 4.0.0
            Status: UNCONFIRMED
          Keywords: wrong-code
          Severity: normal
          Priority: P2
         Component: fortran
        AssignedTo: unassigned at gcc dot gnu dot org
        ReportedBy: pinskia at gcc dot gnu dot org
                CC: gcc-bugs at gcc dot gnu dot org


http://gcc.gnu.org/bugzilla/show_bug.cgi?id=19352

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