Accounting for financial guarantees requires recognition as financial liabilities at fair value and subsequent FVTPL measurement when designated. Financial guarantees that are contingent obligations qualify as financial instruments and, where not insurance contracts, must be recognised as financial liabilities at fair value initially. If designated as measured at fair value through profit or loss, they are remeasured each reporting date with changes in fair value recorded in profit or loss. The guidance includes journal entries for initial recognition, fair value increases and decreases, and settlement treatments on maturity depending on borrower default.