A Northern Trust news release said the rules, adopted in the U.S. by the Financial Accounting Standards Board (FASB) and the Governmental Accounting Standards Board (GASB) related to investments in derivatives, hedging activities, valuations, major asset categories and various risk exposures of certain investments.
The reporting enhancements are designed to help institutional clients better respond to:
- FSP FAS 132(R) -1, now incorporated into FASB ASC Topic 715, Compensation-Retirement Benefits, requires non-governmental benefit plan sponsors to disclose additional information regarding the fair valuation of benefit plan assets, including pricing information on ‘Level 3’ positions and a ‘Level 3’ market value reconciliation, an explanation of investment policies and strategies, and detail on concentration of risk in the portfolio.
- FAS 161, now incorporated into FASB ASC Topic 815, Derivatives and Hedging, expands the disclosure requirements for derivative instruments and related hedged items for non-governmental entities. It requires disclosure of objectives and strategies for using derivatives, fair values of derivatives, associated gains and losses, and details on the various risks associated with derivative investments.
- GASB 53, Accounting and Financial Reporting for Derivative Instruments, provides guidance to certain state and local governmental entities for the measurement, recognition and disclosure of derivative instruments, and also requires entities to explain how and why derivative instruments and hedging activities are being used in investment portfolios.
Available via Northern Trust’s operating platform, the toolkit enhancements are fully integrated into client reporting packages. More information is at www.northerntrust.com.
Last month, Northern Trust announced it has created an IFRS Valuation Toolkit to assist institutional clients with the additional fair value measurement disclosures required by the Internation Finacial Reporting Standards 7 and similar national reporting standards (see Northern Trust Offers IFRS Valuation Toolkit).