The PV proposes that the fair value of derivatives be reported in the financial statements, as well as the change in that fair value. If however, a derivative is effectively hedging (reducing) the risk it was created to address, then the annual changes in the derivative’s fair value would be deferred and reported in a government’s balance sheet. Governments also would disclose additional information about their derivatives in the notes to the financial statements.

Written comments from individuals or organizations not participating in the public hearing should be submitted to the GASB by July 28, 2006.