In Hedge Accounting,which of the Following Items Is a Bona

question 53

Multiple Choice

In hedge accounting,which of the following items is a bona fide exposure?

• A)temporal exposure
• B)fair value exposure
• C)derivative exposure
• D)forward contract exposure

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Definitions:

Projected Benefit Obligation

An actuarial calculation of the present value of future pension benefits earned to date by employees, based on expected salary increases.

Vested Benefits

Employee benefits (such as pension plans) that are fully entitled to the employee, not contingent on further employment.

Actuarial Assumptions

The estimates and hypotheses used by actuaries to calculate insurance risks and liabilities, including rates of mortality, morbidity, and interest.

Service Cost

The actuarial present value of benefits earned by employees during a given period, included in the calculation of pension expense.