KPMG welcomes IASB’s new general hedge accounting standard

KPMG has welcomed the International Accounting Standards Board’s (IASB’s) new general hedge accounting standard — IFRS 9 Financial Instruments (2013) — that has been issued.

Enrique Tejerina, KPMG’s global IFRS financial instruments deputy leader, said: ‘Many preparers will support the new general hedge accounting standard. It provides a more principles-based approach that aligns hedge accounting more closely with risk management, which many constituents view as a positive step forward.’

Some industries — including banking and insurance — may believe that the new standard will not significantly change the ‘status quo’ from their perspective, as they await the IASB’s macro-hedging discussion paper in 2014. However, other industries may be keen to seize the opportunity to further align their hedge accounting with how they actually manage risk.