Today, as part of the macro hedging phase of its financial instruments project, the IASB issued for comment a discussion paper that outlines one possible approach — the portfolio revaluation approach — that entities could use to account for “dynamic risk management activities.” As explained in the IASB’s related press release, under the portfolio revaluation approach:

• “Exposures that are risk-managed dynamically would be revalued for changes in the managed risk through profit or loss.”
• “Fair value changes arising from risk management instruments that are used to manage this risk (derivatives) would also be recognised in profit or loss.”
• “The success of an entity’s dynamic risk management is captured by the net effect of the above measurements in profit or loss.”
• “Fair valuation of the risk exposures that are dynamically managed is not required.”

Comments on the discussion paper are due by October 17, 2014. For further information, refer to the IAS Plus project page and to Deloitte’s IFRS in Focus newsletter on the discussion paper.