The corporate use of derivatives (including employee share options): a study of annual reports. Presenter: Dr Glen Holman Authors: GLEN HOLMAN, Carlos Correia, & GOOLAM MODACK UNIVERSITY OF CAPE TOWN. Introduction.
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The corporate use of derivatives (including employee share options): a study of annual reports
Presenter: Dr Glen Holman
Authors: GLEN HOLMAN, Carlos Correia, & GOOLAM MODACK
UNIVERSITY OF CAPE TOWN
Significant growth in the use of derivatives by the corporate sector in South Africa
Research has focused on determinants of hedging policies, impact on firm value and surveys of the corporate use of derivatives
Our study is the first study of derivative usage by analysingthe accounting disclosure in annual reports
Accounting disclosure in terms of IFRS (International Financial Reporting Standards)
Qualitative & quantitative research based on IFRS
Companies mainly employed forwards (3/4), and then interest rate swaps. Close to 1/3 of companies used options. Futures used by only 10% of companies.
Foreign currency is a major risk for most companies;
Percentage of companies using each type of derivative
Only one company, Afgri Ltd reported using all four derivatives