Financial instruments accounting & internal controls
Whenever updated hedging strategies & policies have been put in place, it is key that these are translated correctly into the accounting schedules & operational procedures to avoid P&L volatility and operational inefficiencies.
At O2 Finance we have an extended audit background specifically on financial instruments. With this we assist our clients translating operational hedging strategies into accounting procedure & financial statements. Key considerations are to ensure compliance with IFRS 9, Local or US GAAP accounting standards, but equally tailoring 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 from the impact assessment workshops up to the updating 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. To achieve effective controls which are not only an administrative burden but really provide an added value, the type of organization & available treasury tools are essential parameters to implement a best practice internal control framework.
- 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.