The Ethics Of Rowell Collins

1064 Words Nov 13th, 2016 5 Pages
Understand the Business Rowell Collins is an international manufacture company, which was found in 1933 and headquartered in Cedar Rapids, Iowa. It provides “flight-deck avionics, cabin electronics, mission communications, information management and simulation etc.” to its governmental and nationwide customers (Rowell Collins, 2016b). And its main competitors in the industry are Raytheon Company, BAE System PLC and Honeywell Aerospace. According to its most recent 8K filing, Rockwell Collins entered into a merger agreement with B/E Aerospace, Inc. And its board of directors has agreed to recommend pay a part of the merge expense by issuing more common stocks.
Assigned Footnote Topic, Relevant Portions of Financials and ASC According to FASB ASC 815-10-05-04, companies must recognize the derivative at fair value on the statement date and designate it to fair value hedge, cash flow hedge or foreign currency hedge. Also according to FASB ASC 815-10-35-02, the company should record changes in fair value of the derivative and hedged items in current earnings. But for cash flow hedges, the company should recognize the changes net of tax in other comprehensive income until the related transactions take in place. In order to manage its exposure to interest rate, Rockwell Collins entered into the 2019 and 2023 interest rate swaps, hedging the fixed-rate debts to variable-rate debts. The company designated them as fair value hedge, and recognized the cash payment or receipts to…
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