by Olga Cileckova, Director in the Corporate Treasury team, PwC
Hedge accounting rules are (finally) changing – the time to act is now! The long-awaited new financial instruments standard – IFRS 9 - was issued in the last week of July. The hedge accounting section of IFRS 9 is designed to respond to the criticism and frustration of most treasurers who feel that accounting often drives the economics.
In short, these changes are good news for corporates and my clients keep asking if they can start applying them straight away. Unfortunately, the standard will not be effective until 2018 and an early adoption is not available for EU-based companies as the EU has not endorsed the standard yet. Currently no date is scheduled for this endorsement and early adoption remains open to non-EU companies only.
Treasurers should act now to take a full advantage of the upcoming good news – hopefully before 2018.