Financial Crisis Workshop – Valuation of Financial Derivatives



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A workshop titled “Financial Crisis: Shareholders Preserving and Enhancing Themselves” was jointly hosted by BMI Appraisals Limited and SHINEWING (HK) CPA Limited on 8 January 2009. Attended by more than 20 financial reporters, editors and writers from local media, the workshop featured an overview of prevalent financial derivatives (including equity-linked investments (ELI), accumulators/decumulators, foreign currency swaps, collateralized debt obligations (CDO), mortgage-backed securities (MBS), and the like) and some essentials of valuing them. It also covered how shareholders analyze a company’s liquidity, profitability, efficiency, solvency and market performance. You can browse the following link for a related article:

As a result of the current financial tsunami, several listed companies have suffered from substantial losses by investing in various financial derivatives for hedging or investment purposes. It has become increasingly important for the company management who has invested/intends to invest in the financial derivatives to be more aware of the potential risks associated with the investments.

Our company director, Mr. Marco Sze, was honoured to be one of the speakers in the workshop to give a presentation on the topic of “Valuations of Financial Instruments (Derivatives)”, sharing insights into how the various financial derivatives work and the commonly used valuation methodologies on them. In addition, he pointed out during the Q&A section that while China’s accounting standards had fully been converged with the international accounting standards since 1 January 2007, less than 20% of listed companies in China (A-share companies), when preparing their annual reports for fiscal year 2007, adopted the fair value accounting for their investments in financial derivatives.

Another speaker, Mr. Roy Lo from SHINEWING (HK) CPA Limited, shared his expertise of how to analyze a company’s financial statements, in particular, looking into realization of future profitability, the quality of assets, the future cash flows and non-financial disclosure of the company, with the audience.

If you want to know more about valuations of financial derivatives, how to better manage the risks associated with your current/future investments in financial derivatives or just simply want to know more about us, please feel free to contact our Director Dr. Tony Cheng at (852) 2593 9633 or Mr. Marco Sze at (852) 2593 9630. You can also visit our website for more details.

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