Find Docs

Salomon - IR 97 1 Q (Page 8)

Wodocs >> Sports : Snowboard, Skiing >> Salomon IR 97 1 Q Page 8
Salomon - IR 97 1 Q
Salomon Swapco Inc
Summary of Accounting Policies
Description of business
Salomon Swapco Inc is a wholly-owned subsidiary of
SBHC, itself a wholly-owned subsidiary of Salomon Inc.
Swapco enters into a broad range of derivative
transactions, including swaps, options and forwards on
interest rates, currencies and equities, with creditworthy
counterparties around the world. All of Swapco's
derivative transactions are hedged with offsetting trades
with SBHC, leaving Swapco with no market risk.
Resulting credit exposure that Swapco may have to
SBHC is more than fully collateralized by SBHC. The
overcollateralization is designed to protect Swapco from
possible adverse market movements during a termination
period. Swapco has received credit ratings of Aaa from
Moody's Investors Service, AAAt from Standard &
Poor's Corporation, and AAA from Fitch Investors
Basis of presentation
The financial statements of Swapco are presented in U.S.
dollars. Income or expense denominated in other
currencies is translated at rates prevailing when the
income was earned or the expense incurred. Non-U.S.
dollar denominated assets and liabilities are translated at
spot exchange rates prevailing at close of business on the
reporting date. The effect of translating non-U.S. dollar
currency balances into dollars is reflected in current
Securities purchased under agreements to resell
Securities purchased under agreements to resell are
generally overnight agreements. They are carried at their
contractual amounts and are collateralized by U.S.
Government securities. Swapco takes possession of the
underlying collateral, monitors its market value relative
to the amounts due under the agreements, including
accrued interest, and when necessary, requires prompt
transfer of additional collateral or reduction in the
repurchase agreement balance in order to maintain
contractual margin protection.
Salomon Swapco Inc
Summary of Accounting Policies
Investment securities and related hedge swaps
Under its operating guidelines, Swapco may invest in
U.S. Treasury and Agencies and other triple-A rated debt
securities. These positions are recorded at their market
value on a trade date basis. Swapco has entered into
interest rate swap agreements with SBHC under which
Swapco pays the total return on the investment securities
which it owns and receives the daily federal funds rate of
interest. These hedge swaps effectively protect Swapco
from changes in the market value of its investment
securities. Like the investment securities, the hedge
swaps are recorded at their market value on a trade date
basis. Their carrying value is included in the Statement
of Financial Condition in the caption
SBHC derivative
Derivative receivables and payables
Derivative receivables (and payables) represent the net
mark-to-market amounts owed to (or by) Swapco from
(or to) individual counterparties under derivative
transactions. Each Swapco
customer transaction is
matched by an equal and offsetting transaction with
SBHC. Derivative transactions are recorded on trade
date and are valued at mid-market prices. Derivative
receivables and payables also include cash collateral
advanced to or by Swapco under derivative master
netting agreements. Derivative receivables and payables
do not include the value of securities pledged to or by
Prepaid expenses and other assets
Prepaid expenses and other assets include, primarily, the
unamortized portion of sales commissions which
Swapco, up to September 30, 1994, paid to affiliated
companies when trades were consummated. Swapco
recognizes these payments as expense over the life of the
transactions involved.
Swapco is a registered service mark of Salomon Swapco Inc.

<< Previous       1 2 3 4 5 6 7 8 9 10 11 12 13 14 15       Next >>

Other Documents:
2010 Yamaha FZ6R, 2009 MZ RT-Striker, 2009 Motom TranCity 125, 1990 Kawasaki VN-15 SE, 2010 Ducati Multistrada 1200, IR 97 2 Q, IR 97 3 Q, IR 98 1 Q, MOODYS, ACCESSORIES, CLOTHING, GOGGLES 04, LENSES, MX GEAR ORDER FORM, consumer sweepstakes, vegas official rules, vtb fwd, vtm wc 12 24, AC power cord IEC, phase thermal pad mv, bja sa, bjs fwa u, erm sa, erm sb, ers 00a, ers sa, ers sb, sva sb, svm sb, vta sb, BWB SX, PFC SX, bjd sa, bsb sa hsa u, bwb sx u, erb 00a, erb 00b, erb fwb, erb hwa, erb hwb, erb sb, erb sz, erd sa, ert 00a, ert 00b, ert fwa, ert fwb, ert hwa, ert hwb, pfc sx u, svb sb, vtc 00a, vtc sa, vtl fwa, wrc sx u,

WODocs | |
All rights reserved. wodocs.comę 2009

New Docs

Documents Category:
Arts (Design, Movies, Music, Radio, Television)
Automotive (Cars, Marine, Motorcycle, ATV, Snowmobiles)
Business (Biotechnology and Pharmaceuticals, Chemicals, Construction and Maintenance, Materials, Real Estate, Services)
Electronics (Computers, Motion Control, Power Supply)
Games (Board, Family, Party, Card, Construction, RC Toys)
Health (Animalm, Beauty, Healthcare, Medicine, Pharmacy, Surgery, Weight Loss)
Home (Accessories, Cooking, Decor and Design, Electrical, Family, Pets)
News (Newspapers, Sports, Television)
Recreation (Collecting, Hiking, Scouting, Survival, Travel)
Reference (Education, Libraries and Archives, Museums)
Science (Agriculture, Astronomy, Biology, Chemistry)
Shopping (Antiques and Collectibles, Clothing, Flowers, Food, Home and Garden)
Sports (Bicycle, Snowboard, Skiing, Other)