Wiley GAAP: Financial Statement Disclosure Manual. Joanne M. Flood
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Example 3.5: Sophisticated Entity Disclosure by Type of Financial Instrument and Type of Counterparty4
The following table illustrates how a sophisticated entity that engages in significant derivative activity might provide the quantitative disclosure requirements in paragraph 210‐20‐50‐3 by type of instrument and by type of counterparty. In this example, the entity further disaggregates the derivative line item into underlying risk, with further disaggregation based on how the derivative is transacted.
Offsetting of Financial Assets and Derivatives—As of December 31, 20X0
| Description | Gross Amounts of Recognized Assets | Gross Amounts Offset in the Statement of Financial Position | Net Amounts of Assets Presented in the Statement of Financial Position |
| Derivatives: | |||
| Interest rate contracts: Over the counter Exchange traded Exchange cleared | $ XX,XXX XX,XXX XX,XXX | XX,XXXXX,XXXXX,XXX | XX,XXXXX,XXXXX,XXX |
| Foreign exchange contracts: Over the counter Exchange traded Exchange cleared | XX,XXXXX,XXXXX,XXX | XX,XXXXX,XXXXX,XXX | XX,XXXXX,XXXXX,XXX |
| Equity contracts: Over the counter Exchange traded Exchange cleared | XX,XXXXX,XXXXX,XXX | XX,XXXXX,XXXXX,XXX | XX,XXXXX,XXXXX,XXX |
| Commodity contracts: Over the counter Exchange traded Exchange cleared | XX,XXXXX,XXXXX,XXX | XX,XXXXX,XXXXX,XXX | XX,XXXXX,XXXXX,XXX |
| Credit contracts: Over the counter Exchange traded Exchange cleared | XX,XXXXX,XXXXX,XXX | XX,XXXXX,XXXXX,XXX | XX,XXXXX,XXXXX,XXX |
| Other contracts: Over the counter Exchange traded Exchange cleared | XX,XXXXX,XXXXX,XXX | XX,XXXXX,XXXXX,XXX | XX,XXXXX,XXXXX,XXX |
| Total derivatives, subject to a master netting arrangement or similar arrangement | XX,XXX | XX,XXX | XX,XXX |
| Total derivatives, not subject to a master netting arrangement or similar arrangement | XX,XXX | XX,XXX | XX,XXX |
| Total derivatives | XX,XXX | XX,XXX | XX,XXX |
| Reverse repurchase, securities borrowings, and similar arrangements | XX,XXX | XX,XXX | XX,XXX |
| Other financial instruments | XX,XXX | XX,XXX | XX,XXX |
| Total | $XX,XXX | $XX,XXX | $XX,XXX |
Financial Assets, Derivative Assets, and Collateral Held by Counterparty—As of December 31, 20X0
| Gross Amounts Not Offset in the Statement of Financial Position | ||||
| Net Amounts of Assets Presented in the Statement of Financial Position | Financial Instruments | Cash Collateral Received | Net Amount | |
| Counterparty A | $XX,XXX | $XX,XXX | $XX,XXX | $XX,XXX |
| Counterparty B | XX,XXX | XX,XXX | XX,XXX | XX,XXX |
| Other | XX,XXX | XX,XXX | XX,XXX | XX,XXX |
| Total | $XX,XXX | $XX,XXX | $XX,XXX | $XX,XXX |
The counterparty should present similar tables.
Example 3.6: Netting of Certain Balance Sheet Accounts
Certain risk management assets and liabilities and certain accrued gas sales and purchases are presented on a net basis in the balance sheet when all of the following exist: (i) Gas Storage Partners and the other party owe the other a determinable amount; (ii) the Company has the right to set off the amount owed with the amount owed by the other party; (iii) Gas Storage Partners intends to set off; and (iv) the right of setoff is enforceable by law.
Notes
1 1 Total of current liabilities is required. (ASC 210‐10‐45‐5)
2 2 Example based on example in ASC 210‐20‐55.
3 3 Example based on example in ASC 210‐20‐55.
4 4 Example based on example