The primary distinction between FAS 133 and IAS 39 is
A)IAS 39 does not permit hedge accounting
B)IAS 39 was adopted earlier than FAS 133
C)IAS 39 applies only to publicly traded corporations
D)IAS 39 applies to all financial assets and liabilities,not just derivatives
E)none of the above

Question

Quizplus · Accepted Answer

IAS 39 applies to all financial assets and liabilities, including derivatives, while FAS 133 mainly deals with accounting for derivatives. Additionally, both standards allow for hedge accounting, although there are some differences in the specific requirements for qualifying for hedge accounting. The other options are incorrect: A is false because IAS 39 does allow for hedge accounting. B is irrelevant because the adoption dates do not affect the primary distinction between the standards. C is false because IAS 39 applies to all entities that prepare financial statements in accordance with International Financial Reporting Standards (IFRS), not just publicly traded corporations.

The Primary Distinction Between FAS 133 and IAS 39 Is