Illustration: Hedge Accounting

IAS 39: Hedge Accounting can cause issues for many students. In the attached document (see link below), I run through an illustrative example on hedge accounting that covers:

1) Why we an entity needs hedge accounting
2) What are the accounting treatment differences between a cash flow hedge and a fair value hedge
3) What are the current issues relating to hedge accounting (applicable to ACCA P2 students only)

Hedging Illustration

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