Wiley GAAP 2008

Definitions of Terms

Bifurcation. Separation of an embedded derivative instrument from the host contract so that separate accounting can be applied to the embedded derivative instrument.

Carrying amount (value). The amount at which securities are measured and reported on the reporting entity's balance sheet by applying the appropriate GAAP.

Contractual obligations. All contractual obligations that are financial instruments meet the definition of a liability set forth in CON 6, Elements of Financial Statements. Some may not be recognized as liabilities in financial statements (i.e., they may be “off‐balance‐sheet”) because they fail to meet some other criterion for recognition. For some financial instruments, the obligation is owed to or by a group of entities rather than a single entity.

Contractual rights. All contractual rights that are financial instruments meet the definition of asset set forth in CON 6. Some may not be recognized as assets in financial statements (may be “off‐balance‐sheet”) because they fail to meet some other criterion for recognition. For some financial instruments, the obligation is held by or due from a group of entities rather than a single entity.

Cost (of a security). The original purchase price plus all costs incidental to the acquisition (e.g., brokerage fees and taxes) unless a new cost basis is assigned as a result of a decline in fair value which is other than temporary.

Derivative instruments. In FAS 133, derivative instruments are defined by ...