Disclosures
In this lesson, you'll learn what disclosures are required when financial instruments appear in the financial statements, and why these disclosures matter for exam success.
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In this lesson
- 0:00 Financial instruments disclosures overview
- 0:18 Significance and offsetting disclosures
- 0:36 Fair value measurement and collateral
- 0:56 Risk nature and extent disclosures
- 1:22 Credit, liquidity and market risk management
- 1:53 Session summary
About this lesson
Financial instruments disclosures fall into two main categories: first, disclosures about the significance of the instruments themselves—including their fair value measurement methods, any collateral pledged, reclassifications, and hedge accounting used; and second, disclosures about the risks they create, which include both qualitative information (how risks are managed and objectives) and quantitative data (exposure levels at the reporting date). You'll discover that the extent of these disclosures depends on the entity's exposure to financial instrument risk, with financial institutions typically providing extensive detail while other entities may disclose much less. Understanding these disclosure requirements is essential for Financial Reporting and Strategic Business Reporting papers, where you need to demonstrate knowledge of what information users of financial statements need to make informed decisions.
Duration: 2m
Transcript
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