Statement 115 requires that changes in the fair value of available-for-sale (AFS) marketable equity securities be reported in a separate component of stockholders ' equity until realized. For certain AFS marketable equity securities, such as those registered on a foreign stock exchange, the changes in fair value may include the effects of changes in the exchange rate between the foreign currency and the investor’s functional currency. The issue is whether foreign currency transaction gains or losses on a foreign currency forward exchange contract or foreign-currency-denominated liability may be reported in the Statement 115 separate component of stockholders ’ equity to offset the portion of the change in fair value of an AFS marketable equity security attributable to foreign Copyright © 2006, Financial Accounting Standards Board Not for redistribution Page 1exchange rates if the forward exchange contract or the foreign-currency-denominated liability is designated as, and is effective as, a hedge of the AFS marketable equity security. EITF DISCUSSIO
To submit an update or takedown request for this paper, please submit an Update/Correction/Removal Request.