Research On Financial Derivative Instrument Accounting

Since the 70s,80s of the 20C,risk and fluctuation in financial market sharply increasedbecause of the disaggregation of Bretton Wood Monetary System, exchange ratesystem replace fixed exchange rate system, oil crisis and the others. So financialdepartments,enterprises and individuals urgently need creationary ways to eluderisk or reduce the cost of capital. Under this circumstance, financial derivativeinstrument emerged as the time required. As it were, financial derivative instrumentalso contained huge risk meanwhile it can spread risk and reduce the cost of capital.In recent years, so many companies bankrupted because of the transactions withfinancial derivative instrument. Under the tragedy, the whole society lay theirattention more and more on the responsibility of accounting. Some criticized theCPA firms, the others criticized the accounting standards. Virtually, all the disputedabout the financial derivative instrument were the disputes about the basics ofConceptual Structure Of Financial Accounting. So, this essay departed into fourparts. The first chapter introduct the studies about financial derivative instrumentaccounting both domestic and abroad after the introduction of the background andsignificance. The second chapter is about the basics of financial derivativeinstrument, such as the defignition, sorts, risks and so on. The third chapter explainthe financial derivative instrument accounting recognitiong, measurement and reportafter some studies about the conceptual structure of financial accounting. The forthchapter mainly about the practices, the details of financial derivative instrumentaccounting in our country and some examples of accounting dealings.