Accounting Motivated Transactions Sample Clauses

Accounting Motivated Transactions. Derivative transactions that are primarily motivated by accounting implications and do not reduce economic or business risk exposure shall not be utilized. Derivative transactions are considered to be accounting motivated transactions if they result in the current recognition of revenue or current reduction of cost as a result of incurring a liability to be recognized in the future or taking a risk to be determined and settled in the future. Use of derivatives solely to manage earnings is prohibited. Derivative transactions are unauthorized if the intention of the transaction is to recognize a profit by closing out, modifying, terminating or offsetting the derivative instrument, even if the transaction would otherwise meet the requirements for use under this policy. EXHIBIT "A" TO MANAGEMENT AGREEMENT - PAGE 13 38 F. Operating Limitations on Use of Derivatives.