13 Jun 2004

Following several days of discussions among representatives of the IASB and representatives of the European Commission, the IASB has posted on its website an Update on IAS 39 as of 11 June 2004. The announcement outlines the steps the Board has already taken to address the concerns of European bankers about IAS 39 and its current consideration of two additional issues: Presentation of cash flow hedges in the balance sheet and statement of changes in equity. A proposal put forward by the European Banking Federation for a new type of hedge accounting for hedges of interest rate margin. The announcement also indicates that the Board will ask its new international working group on financial instruments to: Examine a number of fundamental questions about financial instruments accounting,. Explore ways to improve and simplify existing requirements. Examine broader questions on the application and extent of fair value accounting. .