FASB Just Moved a Mountain, Changed Landscape on Hedging
The Financial Accounting Standards Board has issued a major update to standards for hedging activities. Accounting Standards Update No. 2017-12, “Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities,” several years in the making, offers simplification, opens the doors to new strategies, and may entice nonhedgers to become hedgers. This article describes some of the significant portions of the standard and offers a reminder of effective dates.