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Course Details

Derivatives and Hedging for Accountants (Course Id 768)

Updated / QAS / Registry   Add to Cart 
Author : Michael J Walker, CPA
Status : Production
CPE Credits : 10.0
IRS Credits : 0
Price : $99.95
Passing Score : 70%
Primary Subject-Field Of Study:

Accounting - Accounting and Auditing for Course Id 768

Description :

A derivative is a financial product that derives its value based on an underlying asset, liability or other variable (such as an interest rate, foreign currency or commodity price). Derivatives have become very popular tools for -hedging- (i.e. reducing) financial risk; they have also become an increasingly standard item on big companies balance sheets. Yet understanding how they work, what they are used for and how they can affect the bottom line of a business has proven to be a significant challenge for the accounting and auditing industries.

This course provides an -accountant-friendly- overview of financial risk management and derivative instruments. This overview focuses on the various types of risk that impact financial markets today, as well as the four major categories of derivatives commonly used to hedge these risks (i.e. forwards, futures, swaps and options).

Usage Rank : 0
Release : 2016
Version : 1.0
Prerequisites : None.
Experience Level : Overview
Additional Contents : Complete, no additional material needed.
Additional Links :
Advance Preparation : None.
Delivery Method : Self-Study.
Intended Participants : Anyone needing Continuing Professional Education (CPE).
Revision Date : 14-Sep-2016
NASBA Course Declaration : Participants must complete the final examination within one year of purchase and with a minimum passing grade of 70% or better to receive CPE credit unless otherwise noted on the Course History page (i.e. California Ethics must score 90% or better). After logging in click on the Course History links on your My Courses page for the Begin date and Expire date for the Final Exam.
Approved Audience :

NASBA QAS - NASBA Registry - 768

Keywords : Accounting, Derivatives, Hedging, Accountants, cpe, cpa, online course
Learning Objectives :

Course Learning Objectives

After completing this course, participants should be able to:

    Define the various types of risk that impact financial markets.
    Identify the unique characteristics of forwards, futures, swaps and options.
    Recognize appropriate hedging practices using derivative instruments.

Chapter 1
Introduction to Derivatives and Hedging

After studying this chapter participants should be able to:
    Identify the various types of risk that impact financial markets.
    Recognize proper financial risk management practices.
    Recognize the tools used to manage financial risk.

Chapter 2
Forwards

After studying this chapter participants should be able to:
    Identify the unique characteristics of forward contracts.
    Recognize appropriate hedging practices using forward contracts.
    Calculate the payoff from a forward contract.
    Calculate forward prices and describe the effects of arbitrage on forward pricing.

Chapter 3
Futures

After studying this chapter participants should be able to:
    Recognize the differences between futures and forwards.
    Identify the mechanics of futures exchanges.
    Calculate futures daily margin requirements.
    Recognize the financial and operational risks associated with using futures contracts as hedging tools.

Chapter 4
Swaps

After studying this chapter participants should be able to:
    Identify the unique characteristics of swap agreements and recognize the differences between the various types of swaps.
    Calculate swap settlement amounts.
    Recognize appropriate hedging practices using swaps.

Chapter 5
Options

After studying this chapter participants should be able to:
    Identify the unique characteristics of option contracts.
    Recognize the differences between option contracts and other types of derivative products.
    Recognize appropriate hedging practices using option contracts.
    Calculate the payoff from an option contract.
Course Contents :

Chapter 1 Introduction to Derivatives and Hedging

1.1   The Concept of Risk

1.2   Financial Risks

1.2.1   Interest rate risk

1.2.2   Credit risk

1.2.3   Foreign exchange risk

1.2.4   Other types of financial risk

1.3   Financial Risk Management

1.3.1   The risk management process

1.3.2   The risk profile

1.4   Tools for Hedging Financial Risk

1.4.1   Asset-Liability Management

1.4.2   Derivative instruments

Chapter 2 Forwards

2.1   What are Forward Contracts?

2.2   Forward Payoffs

2.2.1   The payoff function

2.2.2   The payoff diagram

2.3   Forward Pricing

2.3.1   The costs and benefits of forwards

2.3.2   Forward prices and arbitrage

2.4   Foreign Exchange Forwards

2.5   Forward Rate Agreements

Chapter 3 Futures

3.1   What are Futures Contracts?

3.2   Futures Markets

3.2.1   Futures exchanges

3.2.2   Standardization of contracts

3.2.3   Market mechanics

3.2.4   Futures margin

3.2.5   The exchange clearinghouse

3.3   Hedging Risk using Futures

3.3.1   Short hedges

3.3.2   Long hedges

3.3.3   Basis risk

3.4   The Risks of Futures Trading

3.4.1   Hedging vs. speculating

3.4.2   The Barings Bank disaster

Chapter 4 Swaps

4.1   Interest Rate Swaps

4.1.1   Mechanics of interest rate swaps

4.1.2   Creating synthetic assets and liabilities using swaps

4.2   Currency swaps

4.3   Credit default swaps

4.4   Other Types of Swaps

4.4.1   Equity Swaps

4.4.2   Total Return Swaps

4.4.3   Commodity Swaps

Chapter 5 Options

5.1   The Option Contract

5.1.1   Options trading

5.1.2   Options markets

5.1.3   The Options Clearing Corporation (OCC)

5.2    Option Payoffs

5.2.1   Long call option

5.2.2   Long put option

5.2.3   Short call option

5.2.4   Short put option

5.3   Option Strategies

5.3.1   Covered calls

5.3.2   Spreads

5.3.3   Combinations

Glossary

Accounting Course 768 Home: https://www.cpethink.com/accounting-cpa-courses
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