Procedure for Separate Accounting of Interest and Exchange Rate Components of the Fair Value of a Set of Financial Instruments: IFRS
https://doi.org/10.26794/2408-9303-2022-9-5-56-64
Abstract
The research considers the development of the principles of separate accounting and analysis of the interest and exchange rate components of the fair value of a set of financial instruments under the International Financial Reporting Standards (IFRS). The aim of the work is to consider a practical situation with a deferred payment for financial instruments received under an agreement, while the participants of the scheme hedged economic transactions using derivative financial instruments. Here, from the standpoint of accounting and analytics, the mechanism of separation of interest and exchange rate elements, which directly affect the fair value of the forward contract, is of significant importance. It also related this to the requirements of IFRS standards. The research has developed a procedure for separate accounting of these financial components. In particular, it has worked out an algorithm for accounting and mathematical evaluation of exchange rate differences when hedging cash flows of debt instruments with currency forwards. The methodological base of the research includes dynamic situational analysis, system analysis, models of financial mathematics, analytical procedures of the modern theory of financial accounting. The theoretical and practical significance of the research lies in the development of scientific and applied tools based on accounting and process models and evaluation algorithms. The accounting can use the developed procedures, analytical and audit services of banks and corporations in preparing and analyzing financial statements under IFRS.
About the Author
A. Yu. Kuz’min
Financial University
Russian Federation
Russian Federation
Anton Yu. Kuz’min — Dr. Sci. (Econ.), Professor of the Department of Mathematics
Moscow
References
1. Vakhrushina M. A., Get’man V.G., Demina I. D. et al. IFRS and Federal accounting standards: System development, problems of interaction. Moscow: KnoRus; 2019. 206 р. (In Russ.).
2. Adamova G. A., Barilenko V. I., Gerasimova E. B., Getman V. G., Druzhilovskaya T. Yu., Kuzmin A. Yu. et al. Actual problems of standardization of accounting, analysis and audit: scientific notes. Monograph. Moscow: Rusains; 2020. 516 p. (In Russ.).
3. Rozhnova O. V., Ustinova Ya.I., Krishtaleva T. I., Druzhilovskaya T. Yu., Kazakova K. D., Kuzmin A. Yu. al. Methodological and organizational aspects of the formation of transparent reporting of economic entities. Monograph. Moscow: KnoRus; 2019. (In Russ.).
4. Grishkina S. N., Sidneva V. P. Accounting of financial instruments: Development of Russian and international rules. Ekonomika i upravlenie: problemy, resheniya. = Economics and Management: Problems and Solutions. 2019;17(3):83–90. (In Russ.).
5. Druzhilovskaya T. Yu., Druzhilovskaya E. S. Improving the financial reporting of organizations in the digital economy. Uchet. Analiz. Audit. = Accounting. Analysis. Auditing. 2019;6(1):50–61. (In Russ.).
6. Efimova O., Rozhnova O. The corporate reporting development in the digital economy. Advances in Intelligent Systems and Computing. 2019;(850):71–80.
7. Serebryakova T. Y., Klychova G. S., Fedorova L. P., Gordeyeva O. G. Revisiting the fair value and historical cost and their impact on the financial indicators of the company. International Business Management. 2016;10(23):5663–5668.
8. Gebhardt G., Mora A., Wagenhofer A. Revisiting the fundamental concepts of IFRS. Abacus. 2014;50(1):107–116.
9. Lehoux L., Morozova T. V., Safonova E. G., Balashova A. D., Protasov M. V. Practical aspects in calculating of impairment of financial assets according to IFRS 9 Financial Instruments. Proceedings of the 33rd Intern. Business Information Management Association Conference, IBIMA 2019: Education Excellence and Innovation Management through Vision 2020 (April 10–11, 2019). 2019:6624–6632.
10. Kuzmin A. Yu. Accounting price and currency differences of bonds in accordance with the requirements of IFRS. Mezhdunarodnyi buhgalterskii uchet = International Accounting. 2017;20(4):184–197. (In Russ.).
11. Plotnikov V.S., Plotnikova O.V. Recognition and assessment in accounting of financial instruments. Proceedings of the 5th Inter. sci. and pract. conf. “Integration of science and society at the present stage”. 2018:346–360. (In Russ.).
12. Sokolov V. Ya., Klinov N. N. Accounting of futures contracts. Mezhdunarodnyi buhgalterskii uchet = International accounting. 2008;(4):50–55. (In Russ.).
13. Sokolov V. Ya., Klinov N. N. Accounting for transactions with futures contracts. Mezhdunarodnyi buhgalterskii uchet = International accounting. 2008;(5):56–60. (In Russ.).
14. Hull John. C. Options, futures, and other derivatives. Transl. from Eng., 6th ed. Moscow: Vil’yams; 2008. 1024 р. (In Russ.).
15. Druzhilovskaya T. Yu., Dobrolyubov N. A. Accounting for non-derivative and derivative financial instruments. Buhgalterskii uchet = Accounting. 2017;(7):27–37. (In Russ.).
16. Kuzmin A. Yu. The accounting procedure for hedging financial schemes with non-derivative instruments. Uchet. Analiz. Audit. = Accounting. Analysis. Auditing. 2019;6(4):53–60. (In Russ.).
17. Glaum M., Klöcker A. Hedge accounting and its influence on financial hedging: When the tail wags the dog. Accounting and Business Research. 2011;41(5):459–489.
18. Plotnikov V. S., Plotnikova O. V. Principles of accounting for cash flow hedging. Vse dlya buhgaltera = All for accountant. 2016;2(286):25–31. (In Russ.).
19. Kuzmin A. Yu. Issues of accounting for hedging in the IFRS system in the consolidation of statements. Uchet. Analiz. Audit. = Accounting. Analysis. Auditing. 2019;6(1):40–49. (In Russ.).
Review
For citations:
Kuz’min A.Yu. Procedure for Separate Accounting of Interest and Exchange Rate Components of the Fair Value of a Set of Financial Instruments: IFRS. Accounting. Analysis. Auditing. 2022;9(5):56-64. (In Russ.) https://doi.org/10.26794/2408-9303-2022-9-5-56-64
Views:
478
.png)
.png)
Email this article 
