Even though our main goal is and remains to increase awareness and communication in the world of RISK, our staff and collaborators also provide professional services in the following areas:
- Derivatives and Hedging Strategies Consulting
- Financial Software Development
Derivatives and Hedging Strategies Consulting
Mastering risk is especially challenging in today’s rapidly changing, intricately connected, global business environment, where the risks that companies face continually shift and evolve. Risk management empowers organizations to control risk, exploit opportunities, measure performance more effectively, determine capital allocations, satisfy regulatory expectations, and realize a variety of other business advantages.
Derivatives allow firms to hedge risks or to bear risk at minimum cost. They can also create risk at the firm level, especially if a firm is inexperienced in their use. Moreover accounting associated with derivatives and hedging is one of the most complex areas of IFRS (and US GAAP) accounting principles. IAS 39 in particular represents a revolutionary change in the approach to financial reporting of derivative instruments.
Under IAS 39 it is more important than ever that corporations formulate an appropriate risk management policy that reflects the business motivation, economic benefits and accounting impact. The basis for policy is clearly the value-added in economic terms of risk management activities. The introduction of IAS 39 paradoxically means that certain types of hedging, while bringing substantial economic benefits and reducing volatility in economic terms, can actually introduce more volatility into the balance sheet and income statement. This additional accounting volatility, despite having no economic foundation in many cases, must nevertheless be monitored and managed, because it will be highly visible to investors and analysts alike.
Global Risk Guard numbers some among the best financial specialists in this field, coming from top universities or having an outstanding professional track record. Our mission is to enhance the business of companies helping them to achieve the best financial structure through hedging strategies.
Our derivatives specialists have a strong experience with financial instruments and particularly hedge accounting under IAS 39 (and FAS 133). They have assisted a vast number of top global firms and corporate treasuries to implement advanced hedge accounting solutions and to develop the best hedging strategies.
In addition to advising clients on designation, documentation and hedge effectiveness solutions under IAS 39 (and FAS 133), we provide specialised consultancy services on pricing plain vanilla or structured financial instruments.
- financial risk advisory services, including optimization of policies, strategies, processes and organizational structures related to derivative instruments
- accounting advice
- hedge effectiveness testing
- review and implementation of pricing models for derivative instruments
- implementation of reporting system for hedge relationships
- perform sensitivity analysis related to market risk under IFRS 7