22-9-2008 | EFRAG requests comments on its initial assessments of the amendment to IAS 39 “Eligible Hedged Items” against the EU endorsement criteria and on its initial assessment of the costs and benefits of implementation.

EFRAG is today issuing an Invitation to Comment relating to the endorsement for use in the EU of the amendment to IAS 39 Financial Instruments: Recognition and Measurement “Eligible Hedged Item”. It is consulting both on its assessment of the amendment against the EU endorsement criteria and on its initial assessment of the costs and benefits that would arise from the implementation of the amendment in the EU. Comments are requested by 27 October 2008.
	The amendment clarifies two aspects of existing IAS 39.  They are (a) when inflation can be designated as a hedged item in a financial instrument under the hedge accounting provisions in IAS 39 and (b) how hedge accounting can be applied to hedges where a hedging instrument is an option contract. EFRAG’s initial assessment is that the amendment meets the criteria for EU endorsement and that the benefits that will arise from its implementation in the EU are likely to exceed the costs incurred in implementing it.
Document : Amendment to IAS 39 endorsement advice EFRAG Invitation to Comment final.doc
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