Research On Issues Of Derivative Financial Instruments Accounting

Since the 70s, 80s of the 20C, risk and fluctuation in financial market sharply increased because of the desegregations of Bretton Wood Monetary System, exchange rate system replace fixed exchange rate system, oil crisis and the others. So financial departments, enterprises and individuals urgently need creationary ways to elude risk or reduce the cost of capital. Under this circumstance, financial derivative instrument emerged as the time required. As it were, financial derivative instrument also 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 with financial derivative instrument. Under the tragedy, the whole society laid their attention more and more on the responsibility of accounting. Some criticized the CPA firms; The others criticized the accounting standards. Virtually, all the disputed about the financial derivative instrument were the disputes about the basics of Conceptual Structure of Financial Accounting. So, this thesis was departed into six parts. The first chapter introduces the significance and intention about the studies on financial derivative instrument accounting. The second chapter is about the basics of financial derivative instrument, such as the definition, sorts, and characteristics and so on. The less 3 chapters introduce the issue of accounting recognition; measurement; disclosure about financial derivative instrument. The last chapter introduces the practical handle the financial derivative instruments according to the financial policy of China.