http://online.wsj.com/article/SB123583201127300963.html

Sometimes I think the cpa is a big joke. a quote from Buffet (read below). To tackle derivatives I think we need to know what the people writing the test wants us to answer. Nobody knows how derivatives work not even the people who created them:/

On Derivatives -Improved "transparency" -- a favorite remedy of politicians, commentators and financial regulators for averting future train wrecks -- won't cure the problems that derivatives pose. I know of no reporting mechanism that would come close to describing and measuring the risks in a huge and complex portfolio of derivatives. Auditors can't audit these contracts, and regulators can't regulate them. When I read the pages of "disclosure" in 10-Ks of companies that are entangled with these instruments, all I end up knowing is that I don't know what is going on in their portfolios (and then I reach for some aspirin).

... The true is the more confused financial instruments are the worse it gets for our profession to manage in real world and in the exam.  But for sure more jobs "eventually" 

I work for AIG and I can tell you the more we got into this mess the less you understand... you don't know what to disclose because you don't know what you have and you don't know what you have because you have nothing but contratcs tie to "real" investments that you cannot measure in the first place because they are at the same time tie to another "instruments" where a fmv measurement is almost impossible,.... go figure!!   

Add to that the SAFS159 giving some "optional" disclosure to companies.   "options" that's dangerous..

Utesa, you said exactly how many people feel about them including Buffet

"Auditors can't audit these contracts, and regulators can't regulate them. When I read the pages of "disclosure" in 10-Ks of companies that are entangled with these instruments, all I end up knowing is that I don't know what is going on in their portfolios (and then I reach for some aspirin)."

I think the derivatives is the equivalent to Enron. The Wall Street executives greed had not end, and they were making up things(without really know what they were doing) to keep the profits coming.

forgot to say. I feel better after you mentioned that the derivatives on the exam were o.k. Someone on this forum said that on his exam derivatives/hedges were impossible, and he had some type of certification on trading securities or something like that.