Financial instruments accounting impacts of COVID-19
Hot Topic | July 2020
Updated: Ongoing economic disruption may impact the accounting for certain financial instruments.
The ongoing economic downturn caused by COVID-19 may have an impact on the accounting for certain financial instruments. KPMG highlights key reminders for companies to consider in the current economic environment.
Applicability
- All companies
Relevant dates
- Effective immediately
Key impacts
- We believe the recent economic disruption resulting from COVID-19 may impact accounting and financial reporting for various financial instruments.
- This latest update provides guidance on hedge accounting when a modified loan or debt instrument, or the interest payments thereon, is the hedged item in a hedging relationship.
Report contents
- Expected credit losses
- Loan modifications (lender accounting)
- Financial guarantees
- Debt modifications and loan covenants
- Derivatives: Normal purchases normal sales scope exception
- Hedge accounting
- Equity method investments
- Fair value measurements
- Investments in debt and equity securities
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