Featured Product

    ISDA Responds to FASB Proposal on Derivatives and Hedging Standard

    January 22, 2020

    ISDA published its response to the FASB’s proposed Accounting Standards Update on derivatives and hedging (Topic 815). In its response, ISDA supports the efforts of FASB to clarify and improve the US Generally Accepted Accounting Principles (GAAP) applicable to hedging activities. However, the ISDA response suggests the need for improvements via a phase-two hedge improvements project, including changes related to the hedged risk in a cash flow hedge.

    While the FASB efforts to provide clarification on certain matters in the proposed Update is appreciated, ISDA encourages FASB to add a phase-two targeted hedge accounting improvements project to its agenda. ISDA believes that such project could address certain practice issues and other matters that remain unresolved or have arisen since the issuance of Accounting Standards Update 2017-12 on targeted improvements to accounting for hedging activities under Topic 815, which would be more than technical corrections.

    Additionally, ISDA believes certain changes are needed for with respect to Issue 1 in the proposed Accounting Standards Update, which will provide clarification for preparers for certain topics included in Accounting Standards Update No. 2017-12. The amendments in this proposed Update have been classified under four issues.

    • Issue 1 is related to changes in hedged risk in a cash flow hedge.
    • Issue 2 is related to contractually specified components in cash flow hedges of non-financial forecasted transactions.
    • Issue 3 is related to foreign-currency-denominated debt instrument as hedging instrument and hedged item (Dual Hedge).
    • Issue 4 is related to using the term prepayable under the shortcut method. 

    ISDA agrees with the proposed Update on Issues 2, 3, and 4 and does not have any specific comments in relation to those Issues. With respect to Issue 1, the ISDA members believe certain changes to the proposed Update will make it more operable, including an improvement to the existing Topic 815 guidance related to a change in hedged risk within a designated hedging relationship. 

     

    Related Links

    Keywords: Americas, US, Banking, Accounting, Accounting Standards Update, Derivatives and Hedging, Hedge Accounting, Topic 815, FASB, ISDA

    Related Articles
    News

    EBA Publishes Final Regulatory Standards on STS Securitizations

    The European Banking Authority (EBA) published the final draft regulatory technical standards specifying and, where relevant, calibrating the minimum performance-related triggers for simple.

    September 20, 2022 WebPage Regulatory News
    News

    ECB Further Reviews Costs and Benefits Associated with IReF

    The European Central Bank (ECB) is undertaking the integrated reporting framework (IReF) project to integrate statistical requirements for banks into a standardized reporting framework that would be applicable across the euro area and adopted by authorities in other EU member states.

    September 15, 2022 WebPage Regulatory News
    News

    BCBS to Finalize Crypto Rules by End-2022; US to Propose Basel 3 Rules

    The Basel Committee on Banking Supervision met, shortly after a gathering of the Group of Central Bank Governors and Heads of Supervision (GHOS), the oversight body of BCBS.

    September 15, 2022 WebPage Regulatory News
    News

    IOSCO Welcomes Work on Sustainability-Related Corporate Reporting

    The International Organization of Securities Commissions (IOSCO) welcomed the work of the international audit and assurance standard setters—the International Auditing and Assurance Standards Board (IAASB)

    September 15, 2022 WebPage Regulatory News
    News

    EBA Publishes Funding Plans Report, Receives EMAS Certification

    The European Banking Authority (EBA) has been awarded the top European Standard for its environmental performance under the European Eco-Management and Audit Scheme (EMAS).

    September 15, 2022 WebPage Regulatory News
    News

    MAS Launches SaaS Solution to Simplify Listed Entity ESG Disclosures

    The Monetary Authority of Singapore (MAS) set out the Financial Services Industry Transformation Map 2025 and, in collaboration with the SGX Group, launched ESGenome.

    September 15, 2022 WebPage Regulatory News
    News

    BoE Allows One-Day Delay in Statistical Data Submissions by Banks

    The Bank of England (BoE) published a Statistical Notice (2022/18), which informs that due to the Bank Holiday granted for Her Majesty Queen Elizabeth II’s State Funeral on Monday September 19, 2022.

    September 14, 2022 WebPage Regulatory News
    News

    ACPR Amends Reporting Module Timelines Under EBA Framework 3.2

    The French Prudential Control and Resolution Authority (ACPR) announced that the European Banking Authority (EBA) has updated its filing rules and the implementation dates for certain modules of the EBA reporting framework 3.2.

    September 14, 2022 WebPage Regulatory News
    News

    ECB Paper Discusses Disclosure of Climate Risks by Credit Agencies

    The European Central Bank (ECB) published a paper that examines how credit rating agencies accepted by the Eurosystem, as part of the Eurosystem Credit Assessment Framework (ECAF)

    September 13, 2022 WebPage Regulatory News
    News

    APRA to Modernize Prudential Architecture, Reduces Liquidity Facility

    The Australian Prudential Regulation Authority (APRA) announced reduction in the aggregate Committed Liquidity Facility (CLF) for authorized deposit-taking entities to ~USD 33 billion on September 01, 2022.

    September 12, 2022 WebPage Regulatory News
    RESULTS 1 - 10 OF 8514