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EFRAG has analysed the consequences of the IASB's decoupling approach to the review of hedge accounting, separating its project on macro-hedging for open portfolios from the general hedge accounting requirements.
EFRAG holds the view that IAS 39 requirements applicable to macro-hedging should remain applicable in their entirety - cash-flow macro-hedging included - until the IASB completes its now separate project on macro-hedging, so that macro-hedging of open portfolios practices are not subject to successive changes from current practice, in other words that the transition from IAS 39 to IFRS 9 can be completed in one go.
In order for the IASB to achieve its goal of maintaining a status quo for macro-hedging, it would need to modify the wording of paragraph 71 of IAS 39 to allow a broader range of hedges to be accounted for under what remains of IAS 39. Related implementation guidance should be maintained accordingly.
EFRAG is submitting to comments from constituents its draft supplementary letter to the IASB for a short period, so as to complete its conclusions and recommendations to the IASB in March.