Until now, most derivative transactions have been disclosed to investors only in footnotes of financial statements.

Saxena himself had allegedly siphoned off £300 million in 1992-1993 through a string of derivative transactions.

But much of what has happened in the last few months probably had more to do with derivative transactions related to mortgage-backed securities.

A derivative transaction could present a problem if one of the parties defaulted or if its value sharply declined.

In April, Gibson said it was taking a charge of $19.7 million because of several derivative transactions.

Profits were reduced, however, by an unexpected $51 million charge to settle leveraged derivative transactions.

Limiting the types of counterparties that can participate in derivative transactions.

Under yesterday's proposal, she said, "someone looking at a financial statement would not realize that you entered into a derivative transaction to hedge a risk."

The report criticized the activities of the separate trading desk that established prices for derivative transactions and hedged the risks.

Any subsequent rise in the jet price for the period is protected by the derivative transaction.