IAS 39 Scope Definitions

Last Updated on 12/02/2020 by 75385885

IAS 39 Financial Instruments: Recognition and MeasurementIAS 39 Scope Definitions

IAS 39 Scope Definitions

1 [Deleted]

Scope

2 This Standard shall be applied by all entities to all financial instruments within the scope of IFRS 9 Financial Instruments if, and to the extent that:

  1. IFRS 9 permits the hedge accounting requirements of this Standard to be applied; and
  2. the financial instrument is part of a hedging relationship that qualifies for hedge accounting in accordance with this Standard.

2A–7 [Deleted]

Definitions

8 The terms defined in IFRS 13, IFRS 9 and IAS 32 are used in this Standard with the meanings specified in Appendix A of IFRS 13, Appendix A of IFRS 9 and paragraph 11 of IAS Read more

IAS 39 Hedging

Last Updated on 12/02/2020 by 75385885

IAS 39 Financial Instruments: Recognition and MeasurementIAS 39 Hedging

IAS 39 Hedging

71 If an entity applies IFRS 9 and has not chosen as its accounting policy to continue to apply the hedge accounting requirements of this Standard (see paragraph 7.2.21 of IFRS 9), it shall apply the hedge accounting requirements in Chapter 6 of IFRS 9. However, for a fair value hedge of the interest rate exposure of a portion of a portfolio of financial assets or financial liabilities, an entity may, in accordance with paragraph 6.1.3 of IFRS 9, apply the hedge accounting requirements in this Standard instead of those in IFRS 9. In that case the entity must also apply the specific requirements Read more

IAS 39AG Hedging instruments

Last Updated on 12/02/2020 by 75385885

IAS 39 Financial Instruments: Recognition and MeasurementIAS 39AG Hedging instruments

IAS 39AG Hedging instruments

Appendix A Application guidance

This appendix is an integral part of the Standard.

AG1–AG93 [Deleted]

Hedging (paragraphs 71–102)

Hedging instruments (paragraphs 72–77)

Qualifying instruments (paragraphs 72 and 73)

AG94 The potential loss on an option that an entity writes could be significantly greater than the potential gain in value of a related hedged item. In other words, a written option is not effective in reducing the profit or loss exposure of a hedged item. Therefore, a written option does not qualify as a hedging instrument unless it is designated as an offset to a purchased option, including one that is embedded in another Read more

IAS 39AG Hedged items

Last Updated on 12/02/2020 by 75385885

IAS 39 Financial Instruments: Recognition and MeasurementIAS 39AG Hedged items

IAS 39AG Hedged items

Hedged items (paragraphs 78–84)

Qualifying items (paragraphs 78–80)

AG98 A firm commitment to acquire a business in a business combination cannot be a hedged item, except for foreign exchange risk, because the other risks being hedged cannot be specifically identified and measured. These other risks are general business risks.

AG99 An equity method investment cannot be a hedged item in a fair value hedge because the equity method recognises in profit or loss the investor’s share of the associate’s profit or loss, rather than changes in the investment’s fair value. For a similar reason, an investment in a consolidated subsidiary cannot be a Read more