Preface

Accounting for Investments attempts to give an exhaustive treatment of various accounting entries that should be recorded by any entity holding any financial asset. Over the past two decades, there have been several innovative financial instruments from the Street that call for special treatment from the accounting, legal, and regulatory perspectives. The accounting requirements are constantly being monitored and enhanced by the regulators and standard setters to provide more transparency in recording and reporting these financial products.

This book is written from the practical angle and is meant to cater to the needs of accountants as a handbook. The first volume covers equities, futures, and options. It also covers the hedge accounting treatment for equity options, depositary receipts (ADR/GDR), contract for difference (CFD), short selling, and boxed position accounting.

This book assumes that the reader already has basic accounting knowledge. Those who are entirely new to the field of accounting should refer to some basic accounting book before attempting to use this book. However, Appendix A gives an overview of the basic accounting principles and concepts.

The entire trade life cycle of each of the afore-mentioned financial assets is covered in detail with the accounting entries that should be recorded. For each illustration, the journal entries, general ledger accounts, trial balance, income statement, and balance sheet are presented to give a complete understanding ...

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