EFRAG has completed its due process regarding novation of derivatives and continuation of hedge accounting (Amendments to IAS 39) ('the Amendments'), and has submitted its Endorsement Advice Letter and Effects Study Report to the European Commission.
On 27 June 2013, the IASB issued the 'Amendments to IAS 39 Novation of Derivatives and Continuation of Hedge Accounting' (the ‘Amendments to IAS 39’), which provides relief from discontinuing hedge accounting when novation of a hedging instrument to a central counterparty meets certain criteria.
The Amendments to IAS 39 are effective for annual periods beginning on or after 1 January 2014, with earlier application permitted.
EFRAG has issued its Endorsement Advice and Effects Study Report relating to the Amendments for use in the European Union and European Economic Area. EFRAG supports the adoption of the Amendments and recommends their endorsement.
EFRAG’s recommendation is explained in the letter to the European Commission, and the accompanying Basis for Conclusions and the Effects Study Report on the costs and benefits of implementing the Amendments.
Press release
Letter to the EC on amendments to IAS-39
© EFRAG - European Financial Reporting Advisory Group
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