9 key changes that IFRS 9 introduces to hedge accounting
The International Accounting Standards Board published the final chapter of IFRS 9 in July 2014 which replaces the current IAS 39. The standard will be mandatory for annual reporting periods beginning on or after 1 January 2018. We expect that many corporate entities will be interested in early adopting the new standard due to the potential benefits it will bring to the accounting treatment of current and future hedging strategies.
All entities that use derivatives to manage risk could benefit from these changes, regardless of whether they use hedge accounting today. The new standard achieves greater alignment between the economics and the accounting treatment of hedges in a manner that should generally be simpler to implement. Some of the key changes introduced by the new standard are outlined in the publication above.