Comprehensive Guidelines on Over the Counter (OTC) Foreign Exchange Derivatives and Overseas Hedging of Commodity Price and Freight Risks

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....r (OTC) Foreign Exchange Derivatives and Overseas Hedging  of Commodity Price and Freight Risks Attention of the Authorised Dealer Category - I (AD Category - I) banks is invited to Notification No. FEMA 25/2000-RB dated May 3, 2000, as amended from time to time, on the regulations governing foreign exchange derivative contracts. Further, attention is also invited to the comprehensive gu....

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.... the accounts with parent companies are exempted from the minimum net worth criteria), which are complying with the following: • Adoption of Accounting Standards 30 and 32. Companies which are not complying fully with AS 30 and 32 should follow the accounting treatment and disclosure standards on derivative contracts, as envisaged under AS 30/32. • Having a risk managemen....

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....ade in the financial statements as prescribed in ICAI press release dated 2nd December 2005; and • The companies have a risk management policy with a specific clause in the policy that allows using the type/s of cost reduction structures. (Note: The above accounting treatment is a transitional arrangement till AS 30 / 32 or equivalent standards are notified.)" Other provisions o....