Trésorier/Treasurer magazine - N°93 - Apr/May/Jun 2016 - (Page 12)

IFRS 9: Hedging - Treasurers will love it! FOCUS IFRS 9: HEDGING Treasurers will love it! Background from January 1, 2018. Efforts will be needed to implement the new model for data are collected to calculate Expected Credit Losses on their Trade and Lease Receivables portfolios. This part of the implementation work is likely to sit in the CFO/Head of Accounting remit. risk management purposes, i.e. the "Hedge Accounting" framework. The workload required to benefit from a favourable accounting treatment should decrease, with article explains why. Hedge Accounting - The Foundations Remain Intact and were not enthusiastic to move to a radically different approach in a period of LE MAGAZINE DU TRESORIER / TREASURER MAGAZINE - N°93 - APR / MAY / JUNE 2016 Background 12 In the previous issue of the magazine, I gave an overview of the main changes to the accounting of financial instruments as a result of the replacement of IAS 39 by IFRS 9 as from January 1, 2018. Efforts will be needed to implement the new model for provisioning credit losses on financial assets. Corporates will need to review their credit risk management governance and processes to ensure historical and forward-looking data are collected to calculate Expected Credit Losses on their Trade and Lease Receivables portfolios. This part of the implementation work is likely to sit in the CFO/Head of Accounting remit. IFRS 9 brings excellent news to Treasurers in the area of accounting for derivatives for risk management purposes, i.e. the "Hedge Accounting" framework. The workload required to benefit from a favourable accounting treatment should decrease, with accounting moving closer to the economic reality of risk management and hedging. This article explains why. Hedge Accounting - The Foundations Remain Intact The foundations of the hedge accounting framework remain unchanged, which is in fact rather good news for companies (and even more for financial institutions), that have invested a lot in the implementation of processes and the development of know-how, and were not enthusiastic to move to a radically different approach in a period of unprecedented regulatory change. The following foundation elements remain the same: IFRS 9 brings excellent news to Treasurers in the area of accounting for derivatives for risk management purposes, i.e. the "Hedge Accounting" framework. Hedge Accounting Hedge Accounting - wabout hat wIFRS ill you - what will you love 9?love about IFRS 9? A number of sometimes subtle improvements have been introduced in the 700 pages of IFRS 9 to better reflect economic usage of derivatives as hedges, and reduce burden of application. The relaxation in the application rules is introduced at the cost of additional disclosures on risk management and hedging. All in all, Treasurers should find the balance very positive! disclosures on risk of mthe anagement and hedging. All in all, Treasurers should find the Here is an overview main improvements: balance very positive! Here is an overview of the main improvements: Effectiveness testing

Table of Contents for the Digital Edition of Trésorier/Treasurer magazine - N°93 - Apr/May/Jun 2016

Cover
Table of contents
EDITORIAL
FINANCIAL HIGHLIGHTS Luxembourg Tax News
INTERVIEW David Blair - How should we set up an efficient KYC Process?
FOCUS
IFRS 9: Hedging - Treasurers will love it
From 17 to 16 reLEASE of the new LEASE accounting standard
Block chain - Is this buzz word turning into a reality?
Bank Single Gateway, the Plumbing of Bank Connectivity
FORUM
Geopolitical threats for the year ahead
Treasurers proceed with caution
Des difficultés en série pour les nouveaux entrants
Easing the Burden - Is a global KYC standard needed?
European trade repository of the year
La dette senior Européenne, un regard nouveau sur l'obligataire
CORPORATE FINANCE
Stay connected with cloud treasury technology
From stone age to straight through processing
Differentiators for treasury management systems
Complete securities financing solutions for corporates
A full and balanced "meal" for your retirement?
15 MINUTES WITH FinMetrics
THE FINANCIAL RISK OBSERVATORY
NEWS
LIFE BEYOND NUMBERS

Trésorier/Treasurer magazine - N°93 - Apr/May/Jun 2016