To preclude firms from generating artificial gains on exchange transactions booked at fair value,GAAP requires that the transaction

A) must possess commercial substance.
B) have future cash flows that remain substantially the same.
C) be reviewed and approved by the SEC.
D) All of these criteria must be met to book an exchange transaction at the fair value of the exchanged assets.

GAAP requires that an exchange transaction booked at fair value must possess commercial substance, meaning that the transaction must have an economic purpose beyond generating a gain or avoiding a loss. This precludes firms from artificially inflating gains on exchange transactions. Choice B is not entirely accurate, as future cash flows may change even if the exchange transaction has commercial substance. Choice C is also not accurate, as the SEC does not review and approve individual exchange transactions. Therefore, A is the best choice.