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Phone:
(800) 822-4194
(406) 556-0115
Fax:
(206) 774-1285
E-mail: wcpe@westerncpe.com
243 Pegasus Drive
Bozeman, MT 59718
Office hours:
Monday - Friday
7 A.M. - 6 P.M. MST
What Every Financial Professional Needs to Know About Financial Instruments
| NASBA Field of Study | Accounting | 6 CPE Credits |
In the old days, understanding financial instruments and accounting for them wasn't very complex. We had accounts receivables and payables, stocks and bonds, and maybe some options. Today, we have trillions of dollars in interest rate swaps, a gazillion types of options, hedges, securitized transactions, and on and on. There are “exotic” derivatives such as Asian, Barrier, Lookback, Mountain Range, Rainbow, and Swaptions options. We even have derivatives embedded in other derivatives.
This course introduces the accountant to financial instruments from A to Z. We'll begin with basic financial instruments and progress to some of the more exotic ones. Intended for CPAs with little or no experience in financial instruments, the course will be a boon for anyone desiring to understand how financial instruments work and how to account for them. Specific accounting concepts will also be addressed. When should financial instruments be recognized on financial statements? How do you account for instruments that have both debt and equity characteristics? You'll find answers to these questions and more when you join Rod Redding for this fascinating course.
Learning Objectives
Upon successful completion of this course, participants will be able to:
- Define a financial instrument in accounting.
- Understand which financial instruments fall under the general categories of equity products, debt products, derivatives, and alternative investments.
- Explain the characteristics, from the simple to the complex, of individual financial instruments, including bonds, stocks, asset-backed securities, variable interest entities, and exotic instruments.
- Describe the mechanism of an interest rate swap, and calculate the use of an interest rate swap to hedge existing debt.
- Identify the accounting difficulties of an embedded derivative.
- Explain when a company might hedge, the types of hedges that can be used, and the accounting and accounting controversies for those hedges.
- Describe why securitized transactions are used, what they are, and how to account for them.
- Define a special purpose entity and a variable interest entity, identify the reasons they are used, and describe the accounting and accounting controversies for these instruments.
Prerequisites: General knowledge of GAAP.
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