Applied risk management series
With accounting standard IFRS 9 due to replace IAS 39 by 2015, Carlos Blanco, Michael Pierce and José Ramón Aragonés explore the implications for energy hedging programmes with emphasis on hedge effectiveness tests and the use of optimal hedge ratios
The controversial rule-based hedge accounting standards known as International Accounting Standards 39 (IAS 39),are set to be replaced at the beginning of 2015 by a simpler, principle-based approach – International Financial Reporting Standards 9 (IFRS 9) – which attempts to align the accounting of hedging instruments with the International Accounting Standards Board’s risk management objectives.
In this article, we explore some of the main implications of IFRS 91 for energy and commodity
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