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  • Hedge Trackers Comments on FASB’s Recent Proposal

    The Financial Accounting Standards Board recently held a public comment period for proposed changes to ASC 815 – Derivatives and Hedging. You can find Hedge Trackers’ response pasted below, or on “Hedge Trackers, LLC, appreciates the opportunity to comment on the Board’s recent proposal, Derivatives and Hedging (Topic 815): Disclosures about Hybrid Financial Instruments with […]

  • Reminder: FASB Public Comment Period

    Reminder to corporate finance personnel: The public comment period on FASB’s proposed updates to Topic 815, Derivatives and Hedging, closes in one week. The proposed update would require additional disclosures in the notes to the financial statements showing the relationship between each bifurcated embedded derivative and its related financial instrument host contract. The embedded derivative […]

  • FX on the Front Page & in Your Bottom Line

    Turning on the news these days is not much fun. From strife in the Middle East to brewing tensions in Ukraine to economic uncertainty in Japan to rampant concern about the Eurozone itself, bad news is seemingly everywhere. Some of it is truly tragic. Some of it is scary. And if you’re doing business overseas, […]

  • FASB Proposed Accounting Standards Update: Topic 815

    On February 25, 2015, the FASB issued a proposed accounting standards update to Topic 815, Derivatives and Hedging, regarding financial statement disclosures for hybrid financial instruments with bifurcated embedded derivatives. The proposed update would require additional disclosures in the notes to the financial statements showing the relationship between each bifurcated embedded derivative and its related […]

  • Understanding Swap Changes

    Interest rate swaps start and end at zero value. The changes that happen in between can create a wild and bumpy ride. Swaps change for two reasons: Time – making/receiving payments – and interest rates. With an upward sloping yield curve with an expectation of rising rates in the future, a pay fixed-receive variable swap […]

  • This is the Time to Be Cautious…

    The European Union’s initiation of quantitative easing (QE) raises concerns about the state of Europe’s economies, and Japan has just released lower than expected GDP growth associated with its “Abenomics” program. These macroeconomic indicators should signal a review of your existing hedge notionals. A typical corporate hedge strategy is to layer on hedges over time. […]

  • What MBA School Doesn’t Teach You About Currencies

    Currency and risk management has long been a “black box” for the C-suite. It’s time for treasurers to try to change that. That’s no easy task, of course. But bringing to the table a thorough understanding of how currencies have and will impact financial statements goes a long way toward accomplishing that goal.

  • Capella Software Spotlight: Adding a Fiscal Year

    With the change to the new year you should make sure you have your calendar set up for 2015 and beyond in Capella. To update your calendar simply go to Company Setup window Accounting Periods tab and click on the “New FY” button. Capella will prompt you on what information it may need to establish the new period […]

  • Foreign Exchange Resolutions in 2015: Three Things Corporations Need to Do to Minimize Risk

    We’re only a few weeks into 2015, and it’s already been an eventful year in the world of foreign currency. Volatility has been the rule, with the ruble in a free fall, the Swiss central bank abandoning the franc’s exchange rate peg to the euro, and the steep appreciation of the USD against almost every […]

  • Does a Strong Dollar Mean Poor Results?

    The current U.S. Dollar strength surprised many, given the recent loose monetary policy of the “QE Era” Fed. Hedgers, however, know that the expected change is rarely the same as actual change in currency markets today. At last look, the Yen was trading at 117, the Euro 1.18 and the Canadian Dollar at 1.20. How […]

  • Corporate Splits & FX: Creating Opportunity out of Change

    One of 2014’s most significant corporate trends was the splitting of large public companies. Agilent Technologies, eBay, Hewlett-Packard, Symantec and more have (or will be) broken up into two new firms. There are, obviously, many factors to consider when a company splits. It is important, however, that issues related to foreign currency risk not be […]

  • 2014 Year-End Audits: Expectations & Controls

    As many of you prepare for year-end audits, we would like to share our expectations on where auditors will focus, and highlight key controls in a derivative environment. To uncover audit direction and focus, we looked to the 2014 PCAOB findings (available here) related to their reviews of 2013 audits performed by the Big 4.

  • Determining an Appropriate Hedge Period for Your Exposure Profile

    When establishing a new cash flow hedge relationship, it is critical to determine the proper hedge period. There is, however, no single, hard and fast answer to this question; the appropriate hedge period can vary, based on four key variables. Foremost among these is the predictability of the anticipated hedged item. Foreign salaries (and other […]

  • Including Time Value Components in Cash Flow Hedge Relationships: A Good Idea?

    When implementing a cash flow hedge program, a major consideration is whether or not to include time value components (premiums for options, forward points for forwards, etc.) within hedge relationships. Doing so is elective from an accounting perspective; however, there are real-world circumstances and consequences to consider when making the decision. There is a common […]

  • AFP 2014 Recap: Hot Topics & the Debut of RTZ

    From risk management to FX best practices, this month’s 2014 AFP Annual Conference in Washington, D.C., addressed many of the hottest topics in the world of treasury and finance. Featuring more than a dozen speakers (including former Federal Reserve chairman Ben Bernanke, New York Times columnist Thomas L. Friedman and former FBI director Robert Mueller), […]