I derivati nel bilancio degli Enti locali: alcuni elementi per una corretta lettura delle risultanze contabili

"This paper provides some technical insights into the derivative contracts subscribed by Italian Local Administrations (mainly interest rate swaps). The Italian legislation allows local public entities to enter into swap contracts only for debt restructuring purposes, thus establishing “ex lege” a strong functional link between the underlying debt and the corresponding swap. Consequently, in order to properly deal with derivatives accounting issues, the initial position (the original existing debt) and the final one (the new “synthetic debt", i.e. the original debt and the derivative) must be taken into consideration. Such joint valuation is rather challenging because of the separate accounting of the net interest income generated from the derivative and the interest due on the underlying debt. This can lead to misleading interpretations, both in financial and economic terms, that perhaps could be avoided with an accounting treatment that consider the new “synthetic debt" as an unique."