Stock index futures and stock index accounting problems in the stock index

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					Stock index futures and stock index accounting problems in the stock index

 stock index futures and accounting
 a, stock index futures outlined

 stock index futures are derivatives tools, is a stock price of the stock market index
futures trading objects. The emergence of stock index futures originated in the
seventies the twentieth century, when western countries affected by the oil crisis, the
economy is very unstable, the stock market price fluctuations, stock investors an
urgent need for a financial tool to mitigate risk, achieve assets value. So, in April 1982,
the Chicago Mercantile Exchange (CME) created the S & P 500 index
futures (S & P500). Since then, the rapid rise of stock index futures.
Currently, more than 20 countries and regions had launched 27 kinds of main stock
index futures.


 in the United States, although the Dow Jones industrial average is one of the main
stock index, but the stock index futures to the S & P 500 Index is based. It
has the advantages of market-weighted index, but also a broader scope of application,
which included 500 listed companies as the market value of fishing accounted for
80% of the New York Stock Exchange, reflecting the operation of the market situation
in the Dow Jones industrial average than the 30 The company is more extensive and
more reliable. Similarly, the FTSE 100 Index and is the basis for the UK stock index
futures, and its constituent stocks representing 70% of the London stock market.

  level of stock index futures prices to changes in the stock market index based on
trading of stock index futures trading following the general principle that those who
buy low sell high profit. If the futures price is higher than the stock market index, the
difference between the buyer paid cash to the seller; if the futures price is lower than
the stock market index, then the seller to the buyer to pay the cash difference. Stock
index futures trading for investors to provide risk transfer tools; also to the futures
speculators in speculative opportunities. From the nature of stock index futures, it is
the combination of the stock market and futures market the product, not only has the
characteristics of futures also has the characteristics of stocks, stock trading is an
indirect economic activity. It has the following advantages:

 (l) ability to avoid risks. Stock market index is the exchange of all or part of a
representative portfolio of listed stocks. It avoids the impact of a single stock by the
company while the risk of volatility, reached a maximum diversification investments.
Therefore, a strong ability to avoid risk.

 (2) low investment costs. The characteristics of stock index futures with futures,
often only need to pay 5% of the underlying asset value to 10% margin, you can
operate 10 to 20 times the underlying asset. Buy stock index futures also buy the
corresponding stock than the amount of investment is much smaller. Meanwhile, the
stock index futures will be short the futures market mechanism into the stock market,
making judicious investors on the market both in the index rose or fell in the process
can make money, an increase of more profit opportunities.

 (3) a hedging function. Like other financial derivative instruments such as stock
index futures to hedge production was originally conceived. Investors in the stock
index futures, stock and reverse operation, that is to buy stocks, sell futures or sell
stocks, buy futures to hedge risk, to manage large-scale portfolio managers may need
to sell the case of the stock itself, hedge their investment.

 stock index futures, these advantages make it the early 80s the rapid development
worldwide, our country has been aroused in the early 90's heated discussion, in
Shenzhen, Hainan also launched the index futures, But eventually as a guarantee for
the stock market in China and healthy development of start-stop. Although Stock
Index Futures also exist many problems to be solved, but with the gradual
improvement of China's securities market and supporting measures to gradually met,
the Shenzhen and Shanghai stock index futures to the date of launch will be too far
away.

 2, the accounting treatment of stock index futures principles

  use of derivative financial instruments as a result of financial assets and financial
liabilities not arising from transactions occurred in the past, therefore, in the
traditional Accounting in the formation of derivatives transactions in financial assets
and financial liabilities are excluded from the balance sheet, but also to their potential
rewards (profits) and risk (losses) excluded from the income sheet, while the
derivative financial instruments transactions as a "balance-sheet business" deal.
However, derivatives can to bring considerable financial benefits companies may also
have a devastating financial loss business, the traditional accounting approach
obviously does not meet the information needs of users of financial statements.

  1988 年 6 months, the International Accounting Standards Committee (IASC)
established a "Steering Committee on Financial Instruments" (String Committee on
Financial Instrument), and designated by the Committee is responsible for accounting
issues of financial instruments study. At present, the international accounting of
derivative financial instruments related to recognition, measurement and disclosure
and presentation issues, has not formulated a set in a consistent framework of
commonly used criteria. This paper has proposed for several of the accounting
principles.

  (1) recognized in accounting terms, as long as the companies become long-term
financial agreements, parties, initially should be recognized as a financial asset or
financial liability. Termination of recognition, for financial assets, the contract should
be considered in determining the rights of the various compensation has expired or
has lost all (or part) may be; on financial liabilities, as obligations under the contract
(or part of the responsibility) has been discharged, canceled or terminated may be.

 (2) in the accounting measurement, should be completely abandoned at historical
cost measurement requirement for financial assets at end of the period or at different
points in time initially measured at fair value and remeasured. Accounting for futures
contracts by day, "pegged to the market" (marking-to-market) approach. After the end
of each trading day, the Futures Exchange will announce the daily "clearing price",
that is, the official closing price that day, each of the liquidation of contracts are not
closing price by the assessed value. Accounting measurement at different time points
of fair value accounting is consistent with the characteristics of futures.

 (3) terms in the disclosure and presentation of different financial instruments should
be separately detailed dynamic records.


 3, accounting for stock index futures and practical analysis

 stock index futures contracts with cash settlement at maturity, it should be a
"deferred stock index futures section" subject that changes in accounts receivable due
to the cash index (earnings) or payable in cash (loss); the same time, a "stock index
futures gains and losses" subject to the profit and loss account for stock index futures
investment. Take the example in the form of a brief discussion.

 [patients] American companies to hedge their stock investments, at October 18, 1991
sold in the second year in March due to S & P500 index futures contract 25.
The stock portfolio held by the market value of $ 2,100,000. Today the stock index
futures market as follows:

 Open High Low closing price of

 12 月 393.50 395.85 391.75 393.75

 3 月 395.70 398.50 394.10 396.15

 makes an initial measurement of accounting entries, only registers indicate the
number of futures contracts to sell 25 copies and the price of $ 396.15. Suppose, on
December 31 of the stock market value of the portfolio dropped to $ 1,900,000, stock
index futures market as follows:

 Open High Low closing price of the

 3 month 381.75 385.50 375.10 380.15
 6 月 370.50 372.85 368.75 370.75

 at this time, the stock portfolio market value reduction of $ 200,000, according to the
lower of cost method investment provision for decline in value $ 200,000. In addition,
the comparison of two time points of the stock market, futures due in March sold
down to 380.15 from the 396.15, down T16 point, corporate earnings $ 8,000 per
contract. Make entries as follows:

 by: Investment income 2
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