Observations from the front lines provides PwC's insight on current economic issues, our perspective regarding the business impacts, and actions we have seen companies taking to effectively address those issues.
Avoiding hits to earnings when swapping fixed debt to floating: December 2012
Many companies are transacting interest rate swaps to exchange higher fixed rates on existing debt to lower floating rates. Companies electing to pursue fair value hedge accounting treatment for these relationships are often unaware of the quantitative effort needed to support this special accounting treatment because the "shortcut" method is often not available.
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