FASB ASU 2017-12 Deadline Draws Near

As of December 15, 2018, public companies have been required to implement updates (FASB ASU 2017-12 amendment to Topic 815) to their derivatives hedge accounting. With many companies coming up to their reporting deadline in June, there is a lot of helpful advice and clarifying documentation out there. Here are some we found especially valuable:

• Deloitte’s “At a Glance” summary
• KPMG’s detailed look at the update, particularly the set of worked examples
• And of course, FASB’s own overview

Fortunately, pasVal can accommodate these updates as part of it’s push-button Hedge Effectiveness Testing (HET) service. The service has always included:

• Support for testing methods including Consistent Critical Terms, Dollar Offset, Synthetic Instrument, and Regression
• Prospective & Retrospective testing
• The ability to apply user-defined market scenarios

And now, per ASU 2017-12, it allows you to also:

• Hedge only the benchmark rate component of the hedged item in a fair value hedge
• Use partial-term hedges for a fair value hedge

The pasVal HET service is incredibly straightforward and easy to use: identify the hedged and hedging items to be tested, and pasVal will run each applicable test and deliver a detailed report including supporting calculations and itemized test results.

In addition to HET, pasVal offers a series of accounting reports to help you comply with ASC 815 (FAS133), GASB 53, and IFRS 9 (IAS 39).

About Epsilon Technologies Group

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