Description:
A derivative is a financial instrument or other contract that derives its value from the movement of prices, interest rates, or exchange rates associated with an underlying item. Uncertainty about the future fair value of assets and liabilities or about future cash flows exposes firms to risk. One way to manage the risk associated with fair value and cash flow fluctuations is through the use of derivatives. The derivatives and hedging guidance codified in ASC 815, Derivative Instruments and Hedging Activities is considered as one of the challenging areas in GAAP due to its extensiveness and complexity.

This course provides an accountant-friendly overview of derivative instruments and hedge accounting. It discusses derivatives, including the definition of a derivative, scope exceptions to ASC 815, types of risks, accounting requirements, and guidance on embedded derivatives. It addresses the requirements for applying hedge accounting and the specific requirements for fair value hedges, cash flow hedges, and net investment hedges. It also discusses the presentation and disclosure requirements. Finally, the course identifies special situations such as servicing of financial assets and mortgage servicing rights.

Delivery Method: Online Interactive Self Study

Level: Advanced

Prerequisites: None

Advanced Preparation: None

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Author: Delta Publishing

Category: Accounting and Auditing

Field of Study: Accounting

Passing Score: 70%

Publication Date: 09/21/2020

Technical Details: Accounting is a technical field of study.

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Objectives:
1. Identify the attributes of conventional and derivative financial instruments.
2. Recognize the criteria to qualify for hedge accounting.
3. Identify the accounting requirements for different derivatives and the related disclosure requirements.

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NASBA: Yes

QAS: Yes

CPA: Suitable for all CPAs

IRS: No IRS credit for Enrolled Agents.

Profession Identifiers : CPA, CMA