ACCOUNTING FOR DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES Sample Clauses

The 'Accounting for Derivative Instruments and Hedging Activities' clause establishes the rules and procedures for how a company must recognize, measure, and disclose derivative financial instruments and related hedging activities in its financial statements. This typically involves specifying when derivatives should be recorded on the balance sheet, how changes in their fair value are reported in earnings or other comprehensive income, and the documentation required to qualify for hedge accounting. The core function of this clause is to ensure transparency and consistency in financial reporting, helping stakeholders understand the impact of derivatives and hedging on a company's financial position and performance.
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ACCOUNTING FOR DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES. At January 1, 2001 the Company adopted SFAS 133 "Accounting for Derivative Instruments and Hedging Activities" as amended by SFAS 137 and 138. SFAS 133 established accounting and reporting standards for derivative instruments, including certain derivative instruments embedded in other contracts, and hedging activities. It requires the recognition at fair value of all derivative instruments as assets or liabilities in the Company's balance sheet. The accounting treatment of changes in fair value is dependent upon whether or not a derivative instrument is designated a hedge and if so, the type of hedge and its effectiveness as a hedge. For derivatives, which are not designated as ▇▇▇▇▇▇, changes in fair value are recorded immediately in earnings. For derivatives designated as cash flow ▇▇▇▇▇▇, changes in fair value on the effective portion of a hedge are recorded within other comprehensive income ("OCI") until the hedged transaction occurs and are then recorded within earnings. Changes in the ineffective portion of a hedge are recorded immediately in earnings. For derivatives designated as fair value ▇▇▇▇▇▇, changes in fair value are recorded immediately in earnings. We did not, however, have any fair value ▇▇▇▇▇▇ during the three-month and nine-month periods ended September 30, 2002. We discontinue hedge accounting for derivative financial instruments when it is determined that the derivative instrument is no longer effective in offsetting changes in the cash flows of the hedged item; the derivative instrument expires or is sold; the derivative instrument is no longer designated as a hedging instrument, because it is unlikely that a forecasted transaction will occur; a hedged firm commitment no longer meets the definition of a firm commitment; or our management determines that designation of the derivative instrument as a hedging instrument is no longer appropriate. The tests for determining the effectiveness of a cash flow hedge compare on a strict basis the amount and timing of the underlying economic exposure with the cash flows of the derivative instrument. We may continue to use derivative instruments to protect our exposure to interest and currency fluctuations but be unable to meet the tests of effectiveness set out under SFAS 133. In the three-month period ended March 31, 2002, we determined that it was probable that forecasted future prepayments of principal against outstanding US dollar-denominated debt would not occur. Accordingly, the cumulative...
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ACCOUNTING FOR DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES. As of January 1, 2001, the Company adopted Statement of Financial Accounting Standards No. 133 ("SFAS 133") "Accounting for Derivative Instruments and Hedging Activities" as amended by SFAS 137 and 138. SFAS 133 establishes accounting and reporting standards for derivative instruments, including certain derivative instruments embedded in other contracts, and hedging activities. It requires the recognition at fair value of all derivative instruments as assets or liabilities in the Company's balance sheet. The accounting treatment of changes in fair value is dependent upon whether or not a derivative instrument is designated as a hedge and if so, the type of hedge. For derivatives designated as cash flow hedges, changes in fair value are recognized in other comprehensiv▇ ▇▇▇▇me ("OCI") until the hedged item is recognized in earnings. For derivatives designated as fair value hedges, changes in fair value are recognized immediately in earnin▇▇. The Company hedges interest rate risk and foreign currency risk on its Senior ▇▇▇▇▇▇d credit facility and US dollar-denominated debt instruments through the use of interest swaps, forward foreign exchange contracts and foreign currency swaps. The purpose of the derivative instruments is to provide a measure of stability over the Company's exposure to movements in interest rates and the Pound sterling to the US dollar exchange rate. The majority of the Company's derivative instruments are designated as cash flow hedges. Adoption of SFAS 133 on January 1, 2001 resulted in ▇▇▇ ▇ompany recording (pound)15.8 million of decline in fair value to accumulated OCI, consisting of a decline of (pound)27.8 million to short-term derivative liabilities and a (pound)12.0 million gain to long-term derivative assets. During the nine-month period ended September 30, 2001, the Company recorded a (pound)40.5 million gain in fair value to accumulated OCI, consisting of a (pound)9.4 million gain to short-term derivative liabilities and a (pound)49.9 million gain to long-term derivative assets.
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Related to ACCOUNTING FOR DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

  • Banking Services and Swap Agreements Each Lender or Affiliate thereof providing Banking Services for, or having Swap Agreements with, any Loan Party or any Subsidiary or Affiliate of a Loan Party shall deliver to the Administrative Agent, promptly after entering into such Banking Services or Swap Agreements, written notice setting forth the aggregate amount of all Banking Services Obligations and Swap Agreement Obligations of such Loan Party or Subsidiary or Affiliate thereof to such Lender or Affiliate (whether matured or unmatured, absolute or contingent). In furtherance of that requirement, each such Lender or Affiliate thereof shall furnish the Administrative Agent, from time to time after a significant change therein or upon a request therefor, a summary of the amounts due or to become due in respect of such Banking Services Obligations and Swap Agreement Obligations. The most recent information provided to the Administrative Agent shall be used in determining which tier of the waterfall, contained in Section 2.18(b), such Banking Services Obligations and/or Swap Agreement Obligations will be placed.

  • Hedging Obligations 13 Holder............................................................. 13 Indebtedness....................................................... 13 Indenture ......................................................... 14

  • Derivative Instruments Any and all material swaps, caps, floors, futures, forward contracts, option agreements (other than options issued under the Company’s shareholder-approved benefit plans) and other derivative financial instruments, contracts or arrangements, whether entered into for the account of the Company or one of its Subsidiaries or for the account of a customer of the Company or one of its Subsidiaries, were entered into in the ordinary course of business and in accordance with applicable laws, rules, regulations and policies of all applicable regulatory agencies and with counterparties believed by the Company to be financially responsible. The Company and each of its Subsidiaries have duly performed in all material respects all of their obligations thereunder to the extent that such obligations to perform have accrued, and there are no breaches, violations or defaults or allegations or assertions of such by any party thereunder except as would not, singly or in the aggregate, reasonably be expected to have a Material Adverse Effect.

  • Hedging Agreement Any termination payment shall be due by the Borrower under any Hedging Agreement and such amount is not paid within ten (10) Business Days of the due date thereof.

  • Additional Costs in Respect of Letters of Credit Without limiting the obligations of the Borrower under the preceding subsections of this Section (but without duplication), if as a result of any Regulatory Change or any risk-based capital guideline or other requirement heretofore or hereafter issued by any Governmental Authority there shall be imposed, modified or deemed applicable any Tax (other than Indemnified Taxes, Taxes described in clauses (b) through (d) of the definition of Excluded Taxes and Connection Income Taxes), reserve, special deposit, capital adequacy or similar requirement against or with respect to or measured by reference to Letters of Credit and the result shall be to increase the cost to the Issuing Bank of issuing (or any Lender of purchasing participations in) or maintaining its obligation hereunder to issue (or purchase participations in) any Letter of Credit or reduce any amount receivable by the Issuing Bank or any Lender hereunder in respect of any Letter of Credit, then, upon demand by the Issuing Bank or such Lender, the Borrower shall pay immediately to the Issuing Bank or, in the case of such Lender, to the Administrative Agent for the account of such Lender, from time to time as specified by the Issuing Bank or such Lender, such additional amounts as shall be sufficient to compensate the Issuing Bank or such Lender for such increased costs or reductions in amount.