March 16, 2020

Fed Takes Fed Funds Rate to Zero: How Zero Percent Floors Impact Hedge Programs

Posted by Farah Lotia
On Sunday afternoon, the Federal Open Market Committee (FOMC) reduced its target rate by 100bps to a range of 0-0.25%. Zero percent interest rates are quickly becoming a reality in the United States. In fact, treasury inflation-protected...
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March 12, 2020

Identifying Hedgeable FX Exposures: Accounting & Economic Risks

Posted by Lorraine Popylisen
At Hedge Trackers, we are frequently asked to help identify “hedgeable” cash flow exposures under ASC 815 for our clients. Sometimes, there is an accounting exposure but no economic exposure and vice versa. The best hedges protect both the...
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March 10, 2020

Protecting Margins on Foreign Sales: Dollars vs. Percent

Posted by Glenn Suarez
Many companies protect margins from changes in foreign currency rates by using special Cash Flow hedge accounting strategies. But when subsidiaries transact in foreign currencies, the functional currency of that subsidiary impacts the ability to...
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March 06, 2020

How the Coronavirus Can Impact Your FX Cash Flow Hedge Program

Posted by Karen Gubler
Many companies will be affected by a global pandemic (should it come to fruition)—and a number are already being affected just by the containment efforts. We see three sources that will be affected:
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March 05, 2020

Best Practices for FX Hedge Performance Reporting

Posted by Lorraine Popylisen
You’ve spent hours and hours developing a hedging strategy, identifying exposures, forecasting, and verifying hedge accounting, but your efforts shouldn’t stop there. To inform management the job is done, and done well, you need to go to the next...
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March 04, 2020

The Fed's Emergency Rate Cut: What This Means for Interest Rate Hedges

Posted by Ruth Hardie
On March 3, 2020, the Federal Open Market Committee (FOMC) made an emergency 50bp interest rate cut in response to the Coronavirus’ impact on the U.S. economy. Both Cash Flow and Fair Value interest rate hedgers will be affected by the change.
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March 03, 2020

Are Your Treasury & Accounting Teams Disconnected?

Posted by Lisa Wallace
Treasurers are tasked with protecting the gain/loss line as well as foreign revenue, expenses and/or margins. So, it’s not unusual for Treasury departments to want to implement a foreign currency hedge program. A balance sheet hedge program is...
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February 28, 2020

Constant Currency Reporting: Year-Over-Year Challenges

Posted by Helen Kane
Many public corporations report earnings, revenues and expenses on a “constant currency” basis. The objective is to present financials year-over-year (YoY) for comparative purposes without the effects of currency movements. To quote a few public...
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February 26, 2020

3 Hurdles to Overcome When Starting a Cash Flow Hedge Program

Posted by Jeff Goggins
The thought of applying hedge accounting can be daunting for those unfamiliar with the requirements for qualifying for special hedge accounting treatment under ASC 815. In this post, we will discuss the basic requirements for qualifying and...
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