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FASB to require more disclosure on derivatives New York
The Financial Accounting Standards Board, which sets U.S. Accounting rules, on Friday said it would require companies to make more disclosures about the risks they face from credit derivatives. The board said it was amending its standard for accounting for derivative instruments and hedging activities, known as FAS 133. Under the change, sellers of credit derivatives will be required to disclose more information about potential adverse effects of changes in credit risk, general financial performance of the derivatives and cash flows, the board said in a statement. FASB said it was making the change because in the past two years "some sellers of credit derivatives have seen a large number of obligations that are referenced in credit default swaps facing actual or potential defaults, resulting in large liabilities and/or potential credit downgrades." The amendments take effect for reporting periods ending after Nov. 15, the board said. [Source: Reuters]
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