Бухгалтерський облік деривативів та їх репрезентація у фінансовій звітності: проблеми методики та методології
Accounting for derivatives and their representation in financial reporting: problems of methodology and procedure

Summary/Abstract: Derivatives are one of the most effective tools of financial risk management. However, efficient hedging and evaluation of related risks by external stakeholders require a proper level of information support that causes the need for development of methodology of accounting for derivatives and their representation in financial reporting. The purpose of the article is to study the problem issues of methodology and procedure of accounting for derivatives, transactions with them and their representation in financial reporting. The analysis of current methods and practices of accounting for derivatives has allowed us to identify certain problem issues, in particular: the appropriateness and reasonableness of the balance sheet recognition of derivatives, the determination of their original cost, the choice of approaches and methods of recognition of derivatives’ revaluation results, the results of hedge or speculative transactions with derivatives and their reflection in accounts and financial reporting, etc. The study refuted the possibility of qualification of underlying assets’ contracted prices as the fair prices of derivatives. It was established that the method of derivatives’ revaluation accounting for depends on their functional use, type of hedging transactions and their performance, and is quite complicated and ambiguous. Limitations, complexity and ambiguity of accounting for derivatives procedure are largely caused by the imperfection of accounting methodology of owners’ equity. The existing paradigm of accounting in general and accounting for owners’ equity in particular have been formed at the junction and compromise of various theoretical concepts (including capital preservation concepts) that makes impossible the efficient solution of revealed problems.

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