FAS 161 Services

DerivActiv is a leading provider of derivative management services, including independent valuations of derivatives.  We can assist companies and their auditors with FAS 161 compliance.

A DerivActiv representative can be reached at 1-866-200-9012.

FAS 161 amends and expands FAS 133, Accounting for Derivative Instruments and Hedging Activities.  FAS 133 established the accounting requirements for derivatives and hedging activities.  FAS 161 changes the disclosure requirements of FAS 133 by providing a greater understanding of:

• How and why an entity uses derivatives; and
• How an entity’s derivatives and hedging activities affect their financial position and cash flows.

In an effort to comply with the above objectives, FAS 161 requires the following disclosures:

• A discussion on the company’s objectives and strategies for using derivatives;
• The current fair market value of the company’s derivative positions;
• Any contingent credit-related features of the company’s derivative positions; and
• Location and amounts of derivatives in a company’s financial statement.

FAS 161 is effective for financial statements issued for fiscal years and interim periods beginning after November 15, 2008.  For entities that report on a calendar year, March 31, 2009 is the first interim reporting period.  For comparative purposes, disclosure for prior years is encouraged, but not required.