Derivatives

A. V. Rajwade & Co. Pvt. Ltd. (AVRCPL), has been advising Indian corporates on understanding of derivative products & their pricing and usage, virtually since the introduction of derivative products in the Indian market. The company has a reputation for not only keeping with the market on these issues, but also for leading the thinking from time to time.

The Company evaluates derivative proposals for a large number of corporates on an ongoing basis, and acquaints its clients to the jargon as well as the working/mathematics of the various derivatives-based strategies.

Recently, we have also been assisting corporates in analyzing complex derivative structures which have resulted in large losses for them, so as to assess if any “mis-selling” had occurred, and whether the structures at all meet with the extant RBI regulations.

Analysis:
We analyze the treasury’s use of derivatives, policies, procedures and MIS in addition to analyzing bank margins.

Mark to market (MTM):
We have in-house capabilities for valuation of a range of derivatives and undertake such assignments for our clients.

Accounting Standard 30 (AS 30) Compliance and Implementation:
AS 30, “Financial Instruments: Recognition & Measurement”, which corresponds to the International Accounting Standard 39 and deals in hedge accounting, has sweeping changes in accounting of foreign currency derivatives. We at AVRCPL, help clients in;

  • Preparation of hedge documentation ("Currency Hedge Memorandum")
  • Accounting Entries
  • Valuation and Hedge Effectiveness Testing (HET).