Governmental entities have been using more complex financial products to meet rapidly changing financial markets, including incorporating the use of derivative contracts to hedge against certain risks. As derivative use increased in the government sector, there was a corresponding increase in the reporting standards for hedging transactions. The Government Accounting Standards Board (“GASB”) Statement No. 53 (“GASB 53”) requires that state and local governments report the fair value of derivatives in their financial statements. DerivActiv helps governmental entities meet the reporting requirements of hedge valuations and accounting, specifically those related to GASB 53.

Call one of our GASB 53 experts for more information at (866) 200-9012.

GASB 53 requires that public entities provide additional disclosure and implement hedge accounting methods to measure the effectiveness of each outstanding derivative transaction. DerivActiv can help.

Our team of experts provides a full range of GASB 53 services, including:

• Hedge effectiveness testing using one of the four accepted methods of testing: consistent critical terms, synthetic instrument, dollar offset, or regression analysis
• Preparation of a GASB 53 compliance report that can be used for annual financial statements
• Summary of the testing methodology and assumptions used
• Fair value calculation of each derivative in a client’s portfolio
• Footnote disclosures for the audit report
• Journal entries

DerivActiv analyzes the following financial products for GASB 53 compliance:

• Commodity Transactions
• Fx Hedges
• Interest Rate Options
• Interest Rate Swaps

For more information on GASB 53 reporting, call us at (866) 200-9012.