Accounting rulemakers voted to give favorable bookkeeping treatment to companies that use derivatives as insurance against losses, easing concern that using them will cause unwanted fluctuations in corporate earnings.

The seven-member Financial Accounting Standards Board unanimously decided that under certain circumstances so-called hedge accounting will be applied to net written options-non-exchange traded options designed specifically to hedge changes in the value of an asset, such as currencies or commodities. Hedge accounting is considered favorable because it allows companies to avoid booking fluctuations in the value of derivatives until the contracts are sold or mature.

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