- Concept of Hedge
Accounting
- Assessing hedge effectiveness to apply hedge accounting
- Measuring hedge effectiveness of hedged items and hedging instrument
- Types of Hedge
Accounting
- Fair Value Hedges
- Measurement of the exposure to volatility and changes in the fair value of an asset or liability
- Cash Flow Hedges
- Measurement of the exposure to volatility of cash flows from an existing asset or liability or a forecasted transaction
- Hedges of Net Investment in Foreign Operations
- Measurement of net foreign asset values of a subsidiary from changes in foreign exchange rates
- Evaluation Methods for
Hedge Effectiveness
- Evaluation methods attached
- Employing virtual derivatives
- Using a hypothetical derivative to test hedge effectiveness
- Hypothetical derivative represents a perfect hedging instrument
- Currency Basis Spread Removal
- Evaluation after removing the Currency Basis Spread(CBS) inherent in CRS
- CBS : Country Risk Premium inherent in CRS Rate
- Forming various scenarios
- Scenario considering product-specific traits, such as reflecting CCP price and applying specific scenarios
