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.

Numerous other accounting developments are reflected in this edition.

Benefits and Features

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.

Ease-Of-Use Features Include:

• visual aids come whenever possible
• observations, such as differences between instrument types
• practice pointers
• examples to make the requirements as clear as possible to the reader.
• 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.
• references to pertinent paragraphs of the authoritative literature addressing key points, to facilitate research

 Covers Various New Accounting Standards In The Area Of Financial Instruments, Including:

• FASB Statement No. 157 (Fair Value Measurements)
• FASB Statement No. 159 (The Fair Value Option for Financial Assets and Financial Liabilities)
• Numerous FASB Staff Positions (FSPs), including FSP EITF 00-19-2 (Accounting for Registration Payment Arrangements), FSP FIN 39-1 (Amendment of FASB Interpretation No. 39), and FSP FIN 46(R)-7 (Application of FASB Interpretation No. 46(R) to Investment Companies)
• Several EITF Issues, including EITF 06-6 (Debtor’s Accounting for a Modification (or Exchange) of Convertible Debt Instruments), and EITF 06-7 (Issuer’s Accounting for a Previously Bifurcated Conversion Option in a Convertible Debt Instrument When the Conversion Option No Longer Meets the Bifurcation Criteria in FASB Statement No. 133)
• Various EITF D-Topics, including EITF Topic D-109 (Determining the Nature of a Host Contract Related to a Hybrid Financial Instrument Issued in the Form of a Share under FASB Statement No. 133)
• Various revised DIG Issues, including DIG Issue B40 (Embedded Derivatives: Application of Paragraph 13(b) to Securitized Interests in Prepayable Financial Assets), and DIG Issue G26 (Cash Flow Hedges: Hedging Interest Cash Flows on Variable-Rate Assets and Liabilities That Are Not Based on a Benchmark Interest Rate)

Topics and Contents

Part I: Financial Assets

Cash and Cash Equivalents

Investments in Debt and Equity Securities

Loans and the Allowance for Credit Losses

Servicing of Financial Assets

Transfers of Financial Assets

Securitizations

Calculating Yields on Debt Investments

Part II: Financial Liabilities

Debt Financing

Securities Lending Arrangements and Other Pledges of Collateral

Convertible Debt and Similar Instruments

Extinguishments of Debt

Part III: Derivatives and Hedging Activities

Introduction to Derivatives

Embedded Derivatives

Hedge Accounting

Disclosures About Derivatives

Part IV: Equity Instruments

Issuer'S Accounting for Equity Instruments and Related Contracts

Part V: Pervasive Issues

Offsetting Assets and Liabilities in the Balance Sheet