Financial Instruments Accounting & Internal Controls

Whenever updated hedging strategies and policies are put in place, it is key that these are translated correctly into the accounting schedules and operational procedures to avoid P&L volatility and operational inefficiencies.

At O2 Finance we have an extended audit background specifically on financial instruments. We assist our clients translating operational hedging strategies into accounting procedures & financial statements. Key considerations are to ensure compliance with IFRS 9, Local or US GAAP accounting standards, while tailoring implementation to the needs of the organization as there is no 1-size-fits-it-all hedging solution amongst companies.

With the roll-out of IFRS 9, we assist our clients starting from the impact assessment workshops up to the writing of accounting schedules, hedge effectiveness tests & documentation. During these projects, we also work with you to identify any potential opportunities that new accounting standards might bring rather than only transforming the current hedging practices.

When working with high value hedging transactions, it is key for top management to be assured that these are well executed through clearly defined procedures and related internal controls. It is key to assess the organizational constraints & the available treasury tools to define & implement effective value-added internal controls.

Case studies

• For a Belgian-based construction company with activities around the globe, O2 Finance has developed Hedge Accounting policies, documentation and hedge effectiveness tests for foreign currency hedging strategies.
• For an international paper manufacturer, O2 Finance has developed several accounting models for financial instruments and issued debts.
• For a global retailer, we have documented their treasury processes & related internal controls.