An answer to the following question would be much appreciated:
If no hedge accounting is applied, should all changes in fair value of derivatives be recognized as financial income or expense (so below operating result) or is recording of the change in fair value within operating result allowed?
Further, does anyone have one clear memo, including example journal entries of the various possble accounting issues (cf hedge, fv hedge net investment in foreign operation) applying hedge accounting and not-applying hedge accounting and if possible, all other accounting (including journal entries) not applying hedge accounting for the main categories (financial assets through PL; available for sale etc).
Many thanks for your help in advance.
if hedge accounting applied the finansial stateme show amisleadin
effect…… the investor coldn’t make a proper decision so record
items sepparately through fv
For the hedge in a net investment in a foreign operation I advise you to look at the example in IFRIC 16.
assuming you are from the Netherlands and not working for a financial institution where trading of financial assets is the core business, i would have the following answer to your first question. In the netherlands you are required to provide a profit & loss statement according to “besluit modellen jaarrekening” regardless whether you report under Dutch GAAP or IFRS. This “besluit” lists clear requirements where to account for changes in fair value of financial assets. According to these models, fair value changes are listed under other financial income. For other countries I wouldn’t know what the requirements are.
Your second question is more complex and would be quiet extensive to provide to you by e-mail. In general the treatment would be as follows:
Verwerking fair value hedge (IAS 39.89):
Let op: fair value hedge “available-for-sale” instrument