DERIVATIVES USAGE IN RISK MANAGEMENT
              BY TURKISH NON-FINANCIAL FIRMS AND BANKS:
                        A COMPARATIVE STUDY


                        Yakup Selvi, Istanbul University, School of Business
                         Aslı Türel, Istanbul University, School of Business


ABSTRACT: The purpose of this study to compare the previous research about how the non-
finan cial companies listed in the Istanbul Stock Exchange (ISE) and deposit banks in Turkey have
disclosed information regarding the usage of derivatives, and the accounting treatment of these
derivatives. The results of these studies indicate that banks and the non-financial companies listed
in the ISE-100 Indices, which represent 86 % of the market capitalization, use derivatives mainly
for hedging purposes. However, the evidence that they usually prefer reporting their gains/losses
arising from these transactions as “held for trading” instead of applying “hedge accounting”,
since they could not meet the compulsory criterions described in the IAS 39.

Key Words: Derivative Instruments, IAS 39, IFRS 7, Hedge Accounting,

JEL codes: G32, M41