10K and Corporate hedging? - Couldn't answer a question
Hi guys:
I had this question during an interview today and couldn't answer it...I was wondering if anyone here would be able to help me? Granted, I already screwed up this interview, but I hope I can be better prepared for the future!
The question is--if you want to find out about a company's corporate hedging and derivative use, where on its 10-k should you look for such information? How can you find out about a company's financial position on a 10-K?
Thank you so much, guys!
I would assume the MD&A but not 100% sure.
Retarded question - can be in any number of places.
Most likely however it is in the notes to the income statement.
There are certain companies that have sections specifically dedicated to risk management. However, gains / losses from hedging woudl be a line item in most cases (if meaningful) on the IS or at least there'd be a note on it. (Most mining companies and others with meaningful forex exposure will disclose it there)
BTW - as an excercise for you, go download the 10k for exxon mobil as well as say ... Coca Cola and find where the hedging info is. Best to be hands on than ask others bud
Sorry to caveat that is information about specific hedges. If generally to learn about what a company does / if they hedge, its usually in the risk factors disclosures
Don't know why the fck someone would ask you this in an interview? I guess maybe to see that its part of risk management. Did you do IB / finance internship before or claim you did?
http://investing.businessweek.com/research/stocks/financials/drawFiling…
Exxon's 10k
it's right under IS notes
You will not find gains and losses from many hedges on the income statement - these flow through directly to the changes in shareholders equity via Other Comprehensive Income (OCI).
Sorry, to clarify OCI is part of the income statement but NOT current earnings.
Hedges for cash flows are on the IS - and notes under neath -
10K and Corporate hedging? - Anyone able to help? (Originally Posted: 01/17/2012)
Hi guys:
I had this question during an interview today and couldn't answer it...I was wondering if anyone here would be able to help me? Granted, I already screwed up this interview, but I hope I can be better prepared for the future!
The question is--if you want to find out about a company's corporate hedging and derivative use, where on its 10-k should you look for such information? How can you find out about a company's financial position on a 10-K?
Thank you so much, guys!
"NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS" for corporate hedging on the 10-Q..probably the same on the 10-K I'm guessing.
"NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS" for corporate hedging on the 10-Q..probably the same on the 10-K I'm guessing.
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