Research On Application Of Hedging Accounting In China’s Future Market

As the range of financial situation, marketing prices changed a lot, more and more enterprises use future hedging to avoid the risks of the change of goods prices and raw materials, future hedging has become the most regularly used derivative instrument. As the growth of future hedging activities, hedging accounting has become more and more important. As to China’s hedging activities, our ministry of finance has released the new accounting standards, including the NO.24standard which contains specific provision about hedging accounting. Because the formulation of our standard has copied from IASB a lot, it doesn’t adapt to our financial system, so it hasn’t been used regularly, its performance is quite difficult and the applied extent is limited.This thesis will use the normative research method combing with the practical situation of future hedging accounting, analyzing the problems and the reasons to it. At last it will come up with personal advices in order to improve the adaption of future hedging accounting.There are six sections in this paper:The introduction section mainly expatiates on the background, significance and current positions of researches on future hedging accounting, including the development of accounting standard of IASB、FASB and CHINA. Then evaluates the current positions and explains the contents and research idea of this paper.The second section illuminates the basic theory related of future hedging accounting, including the outlines of future hedging accounting, the risks of future hedging activities and basic accounting standard, including the designation of hedging relationship, the judgment of the effectiveness of hedging activities, the accounting recognition and measurement, the information disclosure. This can lay a theory basis for this thesis. And the author will come up with the special accounting issues in future hedging accounting.The third and the forth sections play an important role in the whole thesis. In this part the author will list the data of future hedging activities of China’s listed companies from2009to2011, and then analyze the application situation of future hedging accounting in China’s listed companies, mainly from the scene of the adapted extent and effectiveness judgment, the information disclosure. At last the author will sum up the problems and the reasons to it.The fifth section comes up with personal advice to our future hedging accounting on the basis of the third and the forth sections. This section will discuss whether hedging accounting should exist because it has so many problems. If it should exist, what should we do to improve it.The last section gives the conclusion and the limitations of the research.Through the analyzing of future hedging accounting, the author finds that although it has some weakness, such as its difficult performance and its limited adapted extent, if we cancel it, we can’t describe the true financial situation fairly, it will not be useful to the users of financial statement. So, this thesis will combine with the practical situation, then come up with some personal advice to hedging accounting, including enhancing the adapted extent of it, simplifying the measurement of hedging accounting, enhancing the accountants’understanding of hedging accounting, in order to make some contribution to the performance of hedging accounting.Finally, the author thinks that the developing direction of hedging accounting will be more principled and simple. As the improvement of hedging accounting, the practical value of it must be more significant and it will play a more important role in avoiding risks in our country’s enterprises.