This is the value of cross-border financial claims (i.e. positive fair values) resulting from derivative contracts of all of the reporting party's offices worldwide and the financial claims from derivative contracts of their foreign affiliates vis-a-vis residents of the countries where the offices are located, independent of whether the derivative contracts are booked as off- or on-balance sheet items.                                                                                                                                                   The data should cover in principle all derivative contracts that are reported in the context of the triennial central bank survey of foreign exchange and derivatives market activity, which is coordinated by the Bank for International Settlements (BIS).  The data thus mainly comprise forwards, swaps and options relating to foreign exchange, interest rate, equity, commodity and credit derivative contracts. However, credit derivatives, such as credit default swaps and total return swaps, should only be reported if they belong to the 'trading book' of a protection buying reporting entity.                                                                                                                                                           Financial claims resulting from derivative contracts should be valued at fair values (i.e. current credit exposure calculated as the sum of all positive fair values of derivative contracts outstanding after taking account of legally enforceable bilateral netting agreements) as this ensures consistency not only with the BIS OTC derivatives statistics but also with the valuation principles for all other on- and off-balance sheet items in the BIS international financial statistics. Negative fair values of derivative contracts are considered to represent financial liabilities and are therefore by definition excluded from the reporting of financial claims.                                                                                                                                                                       A derivative is a financial instrument that is derived from some other asset, index, value or other variable (known as the underlying). Derivatives allow risk about the price of the underlying asset to be transferred from one party to another.