Which of the following should be accounted for at fair value?

The correct choice involves the fair value accounting of any derivative embedded in a derivative-type contract. This is consistent with financial reporting standards which require that certain financial instruments, including derivatives, be measured at fair value. Derivative instruments can often contain complex features that need to be independently valued to accurately reflect the financial position of an entity.

This practice ensures that the financial statements provide a clear and relevant picture of the company's exposure to market risks and the potential future cash flows associated with these derivatives. By applying fair value accounting to these embedded derivatives, it allows stakeholders to better assess the economic reality of the entity's financial situation.

While derivatives themselves are widely recognized for fair value accounting, not all assets under management, non-traded options, or only derivatives capture the specific requirement of embedded derivatives. This nuanced understanding of derivative contracts is essential for accurate financial reporting and investment analysis.