FASB Proposes Expanding Allowed Interest Rates to Hedge Accounting Standard
The list of permissible U.S. benchmark interest rates for the Financial Accounting Standards Board’s (“FASB”) hedge accounting standard could expand. In its recently issued Proposed Accounting Standards Update (“ASU”), the FASB would add the Overnight Index Swap rate based on the Secured Overnight Financing Rate as a fifth U.S. benchmark interest rate. The addition would help companies avoid any potential expenses and complexities related to using varying cash flows and discount rates to evaluate the hedged item and the hedging instrument.
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