How does Bimbo Foods Bakeries Distribution classify derivatives as current or non-current assets or liabilities?
Bimbo_Foods_Bakeries_Distribution Franchise · 2025 FDDAnswer from 2025 FDD Document
Derivatives are carried as financial assets when the fair value is positive and as financial liabilities when the fair value is negative. Derivatives are not offset in the consolidated financial statements unless the Company has both a legally enforceable right and intention to offset. Derivatives are accounted for as non-current assets or liabilities if the remaining maturity of the instrument is more than 12 months and the instrument is not expected to be realized or settled within 12 months. All other derivatives are accounted for as current assets or liabilities.
Source: Item 23 — RECEIPTS (FDD pages 84–312)
What This Means (2025 FDD)
According to Bimbo Foods Bakeries Distribution's 2025 Franchise Disclosure Document, derivatives are classified based on their maturity and expected realization or settlement timeframe. Bimbo Foods Bakeries Distribution carries derivatives as financial assets when their fair value is positive and as financial liabilities when their fair value is negative.
Derivatives are considered non-current assets or liabilities if the remaining maturity of the instrument exceeds 12 months and it is not expected to be realized or settled within 12 months. This means that if a derivative's term extends beyond a year and the company does not anticipate converting it to cash or settling it within the next year, it is classified as non-current.
Conversely, all other derivatives are classified as current assets or liabilities. This includes derivatives with a maturity of 12 months or less, or those expected to be realized or settled within 12 months, indicating a shorter-term impact on the company's finances. Bimbo Foods Bakeries Distribution does not offset derivatives in its consolidated financial statements unless it possesses both a legally enforceable right and the intention to do so.