The leading knowledge platform for the financial technology industry
The leading knowledge platform for the financial technology industry

A-Team Insight Blogs

ISDA Comments on Proposals Issued by the IASB and FASB

Share article

The International Swaps and Derivatives Association (ISDA) welcomes the efforts of the International Accounting Standards Board and the Financial Accounting Standards Board to seek convergence on their current US GAAP and IFRS models regarding offsetting of assets and liabilities in the balance sheet.

ISDA believes that reporting derivatives positions on a net basis where netting is enforceable gives the best information for users of financial statements. Net presentation is consistent both with the way derivatives are managed by the entity and with the regulatory treatment of them. It therefore provides the most relevant and risk sensitive information.

ISDA believes the Boards’ proposal to report derivatives on a gross basis rather than a net basis on the balance sheet is counterintuitive, may lead to complexity in practice and can obscure the real position of the entity. It is likely to be misleading when presenting the leverage, credit risk and liquidity risk position of an institution. Misperceptions regarding the risk exposure of derivatives users may impede the ability of corporations, government entities and financial institutions to effectively manage the business and financial risks to which they are exposed.

Related content

WEBINAR

Recorded Webinar: How to leverage the LIBOR transition to improve your data management game

The transition away from LIBOR (London Interbank Offered Rate) is well underway, but there remains considerable ambiguity around how the final stages will be executed – especially with regards to benchmark replacements in markets outside the UK. What are the options, where are the uncertainties and what stage have firms reached in their preparations? The...

BLOG

Industry Calls for SFTR, EMIR Refit Delay

Following a letter from trade bodies including the International Securities Lending Association (ISLA) and the International Capital Market Association (ICMA) this week, EU regulator ESMA is expected to issue clarification on whether it might consider a six-month delay to the upcoming Securities Financing Transactions Regulation (SFTR) currently due to go live in April. The joint...

EVENT

Data Management Summit London

Now in its 10th year, the Data Management Summit (DMS) in London explores how financial institutions are shifting from defensive to offensive data management strategies, to improve operational efficiency and revenue enhancing opportunities. We’ll be putting the business lens on data and deep diving into the data management capabilities needed to deliver on business outcomes.

GUIDE

RegTech Suppliers Guide 2019

Welcome to our brand new RegTech Suppliers Guide. This unique guide provides detailed data profiles on close to 100 suppliers in the RegTech world, offering you an unrivalled selection of solutions for your most pressing financial regulatory challenges. The aim of the A-Team’s RegTech Suppliers Guide is to steer you through this complex marketplace, offering...