Heads Up — FASB Simplifies Accounting for Hybrid Financial Instruments

Published on: 24 Feb 2006

Statement 155 provides entities with relief from having to separately determine the
fair value of an embedded derivative that would otherwise be required to be
bifurcated from its host contract in accordance with Statement 133. Statement 155
allows an entity to make an irrevocable election to measure such a hybrid financial
instrument at fair value in its entirety, with changes in fair value recognized in earnings.


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