Search
 

It’s Time to Speak up on Hedge Accounting

The FASB has released its long-awaited exposure draft. Corporate hedgers (and prospective hedgers) need to weigh in before the rules are finalized.

By Treasury & Risk Staff | Updated on September 19, 2016
The Financial Accounting Standards Board (FASB) recently released a long-awaited exposure draft proposing changes to ASC 815, the rules that govern hedge accounting. The release was met with enthusiasm from many hedge accounting experts.

“This is the best thing that has happened to corporate hedging in decades,” says Helen Kane, founder and president of hedge accounting software and consulting firm Hedge Trackers.

As expected, the proposed changes would enable a company to use special hedge accounting for component hedging of both financial and non-financial risks. This means that a corporate commodity hedger, for example, could use special hedge accounting for a derivative that mitigates only a portion of the overall risk that the commodity poses to the company. Under current rules, special hedge accounting is allowed only if the financial instrument successfully protects against the entire risk the commodity poses to the organization.

Complete your profile to continue reading and get FREE access to Treasury & Risk, part of your ALM digital membership.

Your access to unlimited Treasury & Risk content isn’t changing.
Once you are an ALM digital member, you’ll receive:

  • Critical Treasury & Risk information including in-depth analysis of treasury and finance best practices, case studies with corporate innovators, informative newsletters, educational webcasts and videos, and resources from industry leaders.
  • Exclusive discounts on ALM and Treasury & Risk events.
  • Access to other award-winning ALM websites including PropertyCasualty360.com and Law.com.

Already have an account?

NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.

Recommended Stories

Treasury & Risk

Join Treasury & Risk

Don’t miss crucial treasury and finance news along with in-depth analysis and insights you need to make informed treasury decisions. Join Treasury & Risk now!

  • Free unlimited access to Treasury & Risk including case studies with corporate innovators, informative newsletters, educational webcasts, and resources from industry leaders.
  • Exclusive discounts on ALM and Treasury & Risk events.
  • Access to other award-winning ALM publications including PropertyCasualty360.com and Law.com.

Already have an account? Sign In Now
Join Treasury & Risk

Copyright © 2024 ALM Global, LLC. All Rights Reserved.