IAS 39 — Hedging future cash flows with purchased options
The IFRIC discussed whether it should develop guidance for the situation in which a purchased option in its entirety is designated as a hedging instrument to hedge variability in future cash flows in a cash flow hedge. In particular, they discussed a staff analysis of the guidance on the topic already in IAS 39 Financial Instruments: Recognition and Measurement, in particular material in the Implementation Guidance, Topic F.
The IFRIC agreed with the staff analysis that there was sufficient guidance in the Standard and related Implementation Guidance to answer the issue. It was also philosophically opposed to issuing an Interpretation (i.e. authoritative guidance) on something contained in Implementation Guidance (i.e. non-authoritative). The IFRIC reached a tentative decision not to add this item to its agenda. The staff was asked to adapt its analysis for inclusion in the tentative agenda decision.
