Harvest is the detachment of produce from a biological asset or the cessation of a biological asset’s life processes.





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Hedge effectiveness

Hedge effectiveness is the degree to which changes in the fair value or cash flows of the hedged item that are attributable to a hedged risk are offset by changes in the fair value or cash flows of the hedging instrument (see Appendix A paragraphs AG105–AG113A).

Definition IAS 39





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Hedge ratio

The relationship between the quantity of the hedging instrument and the quantity of the hedged item in terms of their relative weighting.





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Hedged item

A hedged item is an asset, liability, firm commitment, highly probable forecast transaction or net investment in a foreign operation that (a) exposes the entity to risk of changes in fair value or future cash flows and (b) is designated as being hedged (paragraphs 78–84 and Appendix A paragraphs AG98–AG101 elaborate on the definition of hedged items).

IAS 39 Definition





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Hedging instrument

A hedging instrument is a designated derivative or (for a hedge of the risk  of changes in foreign currency exchange rates only) a designated non-derivative financial asset or non-derivative financial liability whose fair value or cash flows are expected to offset changes in the fair value or cash flows of a designated hedged item (paragraphs 72–77 and Appendix A paragraphs AG94–AG97 elaborate on the definition of a hedging instrument).

IAS 39 Definition





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Held for trading

A financial asset or financial liability that:

  1. is acquired or incurred principally for the purpose of selling or repurchasing it in the near term;
  2. on initial recognition is part of a portfolio of identified financial instruments that are managed together and for which there is evidence of a recent actual pattern of short-term profit-taking; or
  3. is a derivative (except for a derivative that is a financial guarantee contract or a designated and effective hedging instrument).




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Highest and best use

The use of a non‑financial asset by market participants that would maximise the value of the asset or the group of assets and liabilities (eg a business) within which the asset would be used.





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Hybrid instrument

A financial instrument which does not contain an equity component but which contains a host contract and an embedded derivative.





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Money loses purchasing power at such a rate that comparison of amounts from transactions and other events that have occurred at different times, even within the same accounting period, is misleading.

Hyperinflation is indicated by characteristics of the economic environment of a country which include, but are not limited to, the following:

  1. the general population prefers to keep its wealth in non-monetary assets or in a relatively stable foreign currency. Amounts of local currency held are immediately invested to maintain purchasing power;
  2. the general population regards monetary amounts not in terms of the local currency but in terms of a relatively stable foreign currency. Prices may be quoted in that currency;
  3. sales and purchases on credit take place at prices
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