NISM Series XIII Common Derivatives Certification Exam Notes
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Presentation in Financial Statements: Derivative assets/liabilities are presented as current/non-current based on purpose — trading derivatives are current; hedges follow the classification of the hedged item.
No Netting Off: Netting of assets and liabilities is not permitted except for basis adjustments under cash flow hedges.
Hedge Effectiveness: Entities must assess hedge effectiveness and ineffectiveness. Methods may include critical terms match, dollar offset, or regression analysis.
Accounting Standard (AS) 30: Defines financial instruments, including derivatives, as contracts whose value changes with specified variables, requires minimal initial investment, and settles at a future date.
Applicability of AS 30: Exchange-traded derivatives meet AS 30 conditions.
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