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U.S. GAAP Codification Accounting Topics



U.S. GAAP
Financial Reporting Guide



Principles of AccountingU.S. GAAP Financial Reporting Guide
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Section 4300: Derivatives and Hedging

[U.S. GAAP Codification Topic]
815 Derivatives and hedging
815-10 Overall
815-15 Embedded derivatives
815-20 Hedging-general
815-25 Fair value hedges
815-30 Cash flow hedges
815-35 Net investment hedges
815-40 Contracts in entity's own equity
815-45 Weather derivatives

[U.S. GAAP before the Codification]
SFAS 133, June 1998, Accounting for Derivative Instruments and Hedging Activities
SFAS 137, June 1999, Accounting for Derivative Instruments and Hedging Activities,
Deferral of the Effective Date of FASB Statement No. 133, an amendment of FASB Statement No. 133
SFAS 138, June 2000, Accounting for Certain Derivative Instruments and Certain Hedging Activities, an amendment of FASB Statement No. 133
SFAS 149, April 2003, Amendment of Statement 133 on Derivative Instruments and Hedging Activities

1. Derivatives
(1) Derivative instruments are recognized in financial statements
(2) Derivative instruments are measured at fair value

2. Characteristics of Derivative Instruments, ASC 815-10-15-83
(1) Underlying and notional amounts
(2) No initial net investment or smaller than usual initial net investment
(3) Require or permit net settlement

3. SFAS 133 does not apply to the following:
(1) Regular way security trades
(2) Normal purchases and normal sales
(3) Certain insurance contracts
(4) Certain financial guarantee contracts
(5) Certain contracts not traded on an exchange
(6) Derivatives as impediments to sales accounting
--> e.g., guarantee of residual value to avoid sales-type lease
(7) Investments in life insurance
(8) Certain investments by defined benefit pension plans
(9) Loan commitments
(10) Registration payment arrangements, FSP EITF 00-19-2

4. Embedded derivative instruments
--> are separated from the host contract
--> and apply SFAS 133 as a derivative instrument

5. Measurement of derivatives
--> derivative instruments are measured at fair value

6. Gains and losses on derivative instruments
(1) No hedging designation
--> gains and losses are recognized in earnings

(2) Fair value hedge
--> gains and losses are recognized in earnings

(3) Cash flow hedge
(3a) effective portion of the gains and losses are recognized
--> in other comprehensive income

(3b) ineffective portion of the gains and losses are recognized
--> in earnings

(4) Foreign currency hedge
(4a) hedge of a foreign currency denominated firm commitment
--> gains and losses are recognized in earnings

(4b) hedge of an available-for-sale security
--> gains and losses are recognized in earnings

(4c) hedge of a forecasted foreign currency denominated transaction
--> gains and losses are recognized in other comprehensive income

(4d) hedge of a net investment in a foreign operation
--> gains and losses are recognized in other comprehensive income

7. If the hedged item is denominated in foreign currency
--> designate as one of the following:

(1) Fair value hedge of
--> an unrecognized firm commitment
--> recognized asset or liability

(2) Cash flow hedge of
--> an unrecognized firm commitment
--> a forecasted transaction

(3) Hedge of a net investment in a foreign operation




Index of U.S. GAAP Financial Reporting Guide


U.S. GAAP by Codification Topics 
 
 105  GAAP Hierarchy 
 105  GAAP History 

 205  Presentation of Financial Statements 
 205-20 Discontinued Operations 
 210  Balance Sheet 
 210-20 Offsetting 
 220  Comprehensive Income 
 225  Income Statement 
 225-20 Extraordinary and Unusual Items 
 230  Statement of Cash Flows 
 250  Accounting Changes and Error Corrections 
 260  Earnings per Share 
 270  Interim Reporting
 
 310  Impairment of a Loan
 320  Investment Securities 
 320  Other-Than-Temporary Impairments, FSP FAS 115-2 
 320-10-05 Overview of Investments in Other Entities 
 320-10-35 Reclassification of Investments in Securities
 323-10 Equity Method Investments
 323-30 Investments in Partnerships and Joint Ventures 
 325-20 Cost Method Investments 
 330  Inventory

 340-20 Capitalized Advertising Costs 
 350-20 Goodwill 
 350-30 Intangibles Other than Goodwill 
 350-40 Internal-Use Software 
 350-50 Website Development Costs 
 360  Property, Plant and Equipment
 360-20 Real Estate Sales


 410  Asset Retirement and Environmental Obligations 
 420  Exit or Disposal Cost Obligations 
 450  Contingencies 
 450-20 Loss Contingencies 
 450-30 Gain Contingencies
 480  Redeemable Financial Instruments 

 505-20 Stock Dividends, Stock Splits 
 505-30 Treasury Stock 

 605  SEC Staff Accounting Bulletin, Topic 13 
 605-25 Revenue Recognition - Multiple Element Arrangements 
 
 715-30 Defined Benefit Plans - Pension
 718  Share-Based Payment 
 730  Research and Development 
 730-20 Research and Development Arrangements 

 805  Business Combinations  
 810  Consolidation 
 810  Noncontrolling Interests 
 810  Consolidation of Variable Interest Entities, SFAS 167 
 
 815  Derivatives and Hedging Overview 

 820  Fair Value Measurements  
 820  Fair value when the markets are not active, FSP FAS 157-4
 825  Fair Value Option 

 830  Foreign Currency Matters 
 830-20 Foreign Currency Transactions 
 830-30 Translation of Financial Statements 
 835  Interest 
 835-20 Capitalization of Interest 
 835-30 Imputation of Interest 

 840  Leases 
 840-20 Operating Leases 
 840-30 Capital Leases 
 840-40 Sale-Leaseback Transactions
 845  Nonmonetary Transactions 

 855  Subsequent Events 
 860-20 Sale of Financial Assets, SFAS 166 
 860-50 Servicing Assets and Liabilities, SFAS 156 

 985-20 Costs of software to be sold  


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