Financial Instruments

The passage of the Sarbanes-Oxley Act in 2002 has had sweeping implications for professionals involved in financial reporting, ranging from certification of financial reports by chief executives to a mandated study by the SEC of principles-based accounting standards, rather than rules-based (which is clearly the current state of affairs for financial instruments accounting). Financial Instruments: A Comprehensive Guide to Accounting and Reporting is written for practicing accountants and other professionals who need to understand the accounting for financial instruments. This unique book pulls together all of the existing accounting literature on financial instruments into one volume, organizes it logically, and describes the requirements as simply as possible. This comprehensive, topic-based approach will save practitioners time and effort in researching accounting issues. It includes guidance issued by the Financial Accounting Standards Board, the FASB's Emerging Issues Task Force and Derivatives Implementation Group. It also includes standards issued by the AICPA Accounting Standards Executive Committee, and the audit and accounting guides issued by various committees of the AICPA. This guide covers accounting requirements for public and private companies and touches on unique aspects of reporting financial instruments by nonprofit organizations. Over 400 pieces of authoritative literature are referenced in this book. Each chapter covers the relevant accounting questions for each type of instrument, including: - When and how to initially recognize the instrument in the balance sheet - How to measure the instrument in subsequent periods - How to recognize income or expense - When and how impairment must be recognized - When the instrument should be removed from the balance sheet - What disclosures should be provided in the footnotes. The text includes visual aids whenever possible; observations, such as differences between instrument types; practice pointers; and examples to make the requirements as clear as possible to the reader. The book also includes: a cross-reference to the original pronouncements, citing the chapters in which they are discussed; a glossary of terms including references to the applicable chapters; and a detailed topical index. To facilitate research, the text includes references to pertinent paragraphs of the authoritative literature addressing key points.