NFP Organizations Like the Red Cross Invest in Derivatives to Hedge

NFP organizations like the Red Cross invest in derivatives to hedge their financial risks. How do the accounting standards for NFP hedge investments differ from the accounting standards for other NFP investments?

A) There is no difference.
B) Unrealized gains and losses on hedge investments are reported as changes in net assets with donor restrictions on the statement of activities, while unrealized gains and losses on other investments are not reported.
C) Unrealized gains and losses on hedge investments are not reported, while unrealized gains and losses on other investments are reported as changes in net assets without donor restrictions on the statement of activities.
D) Unrealized gains and losses on hedge investments are deferred on the statement of financial position until the hedged item is reported on the statement of activities, while unrealized gains and losses on other investments are reported as a change in net assets without donor restrictions on the statement of activities.