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Companies Bypass FAS 133 to Achieve Hedge Accounting

Tammy Whitehouse | September 9, 2008

A study this week from the Georgia Tech Financial Analysis Lab provides some indication of why companies may be eager to shed the complexities of U.S. Generally Accepted Accounting Principles and flock to a more flexible international rule book. The lab examined hedge accounting practices at 50 companies and came up with explicit reasons they prefer to steer clear of the complexities of hedge accounting rules—either by finding another way to create a hedge effect or simply suffering the volatility that’s sure to flow through to earnings.

MulfordAccording to Georgia Tech’s analysis, applying the “accounting morass” of Financial Accounting Statement No. 133: Accounting for...

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