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Valuations of Derivatives

Short Description: 
Under ASC 815, derivatives and hedging activities must be recognized as assets or liabilities in the financial statement and measured at fair value.

In recent years, derivatives have been widely used to provide flexibility in financing and investing. Due to complications in accounting for derivatives, the FASB issued Statement of Financial Accounting Standards (SFAS) No. 133 in 2000. Now codified as ASC 815, the requirement calls for derivatives and hedging activities to be recognized as assets or liabilities in the financial statement and measured at fair value.

For many types of derivatives, the valuation process is highly specialized. The process requires an understanding of the underlying asset on which the derivative is based as well as the terms of the specific contract. Our professionals are able to value all of a client’s derivatives and hedging instruments on a supportable basis.
 

  • VRC valued certain embedded derivatives in support of The Princeton Review's financial reporting requirements under ASC 815.
    Derivatives Valuation

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