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4 Cards in this Set
- Front
- Back
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Derivatives are recognized as what on the financial statements?
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Assets or Liabilities
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How are derivatives measured?
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At Fair Value (FMV)
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Changes in FMV of non-hedge derivatives are reported as
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Gains/Losses in earnings (I/S)
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Accounting for the unrealized gains/losses from the changes in FMV of hedge derivatives depends on the intended use of the derivative (3 of them)
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(1) FV Hedge - reported in earnings
(2) Cash Flow hedge - effective portion reported in OCI; ineffective portion reported in earnings. (3) Hedge of net invt in a foreign operation - reported the same as #2. |
