Financial Accounting


Delay on Derivatives Standard

FASB announced it would defer implementation of its new rules for accounting for derivatives. The effective date for FASB Accounting Statement no. 133, Accounting for Derivative Instruments and Hedging Activities will be delayed to fiscal years beginning after June 15, 2000.

Statement no. 133 requires companies to report in their earnings any changes in the value of derivatives that don't balance out a loss or gain on the instrument they are supposed to hedge. The standard, which was issued in June 1998 after a lengthy delay, applies to quarterly and annual financial statements.

This time FASB postponed implementation of Statement no. 133 as a response to the many comments from companies requesting more time to modify their information systems and to learn how to apply the new derivative standard.

"We have received a number of requests from constituents asking for a one-year delay, based on unforeseen problems with getting systems up to speed for year 2000 considerations," said FASB Chairman Edmund L. Jenkins. "Others had questions about applying Statement no. 133 in practice and the need to educate their people internally about the new standard's requirements."

SPONSORED REPORT

6 key areas of change for accountants and auditors

New accounting standards on revenue recognition, leases, and credit losses present implementation challenges. This independently-written report identifies the hurdles that accounting professionals face and provides tips for overcoming the challenges.

PODCAST

How tax reform will impact individual taxpayers

Amy Wang, a CPA who is a senior technical manager for tax advocacy at the AICPA, answers to some of the most common questions on how the new tax reform law will impact individual taxpayers.