FASB’s proposed accounting relief clears the way for hedge accounting to continue during LIBOR transition

September 9, 2019 Chatham Financial

Thomson Reuters logo

 

 

 

“Absent this guidance, companies would have had to forecast when the derivative and its hedged item are going to transition to SOFR, and those might be at different times, and those are very judgmental, very subjective considerations,” [Rob Anderson, a CPA at Chatham Financial in Kennett Square, Pennsylvania] said. “The results of what guess that you make about that timing could drive whether your hedging relationship qualifies or not. And so FASB is wiping that away saying ‘you don’t have to consider that.’ They’re making it very easy for hedge accounting to continue.”

Read more

Previous Article
SEC raises expectations for public disclosures on LIBOR transition risks
SEC raises expectations for public disclosures on LIBOR transition risks

Chatham's methodology for entities to assess their LIBOR transition activities and risks to meet the SEC's ...

Next Article
New Hedge Accounting Rules: Are You Ready?
New Hedge Accounting Rules: Are You Ready?

An in-depth review of ASU 2017-12 and its potential effects on your hedging program.