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The International Accounting Standards Board (IASB) issues an exposure draft, Fair Value Hedge Accounting for a Portfolio Hedge of Interest Rate Risk, of proposed amendments to International Accounting Standard (IAS) 39, Financial Instruments: Recognition and Measurement.


* The International Accounting Standards Board (IASB IASB - Illinois Association of School Boards
IASB - Indiana Association for School Broadcasters
IASB - Internal Auditing Standards Board
IASB - International Accounting Standards Board
IASB - International Association of Speakers Bureaus (formerly International Group of Agencies and Bureaus)
) issues an exposure draft, Fair Value
Fair Value
1. The estimated value of all assets and liabilities of an acquired company used to consolidate the financial statements of both companies.

2. In the futures market, fair value is the equilibrium price for a futures contract. This is equal to the spot price after taking into account compounded interest (and dividends lost because the investor owns the futures contract rather than the physical stocks) over a certain period of time.
 Hedge Accounting for a Portfolio Hedge of Interest Rate Risk
Rate risk
In banking, the risk that profits may drop or losses occur because a rise in interest rates forces up the cost of funding fixed-rate loans or other fixed-rate assets.
Interest Rate Risk
The risk that an investment's value will change due to a change in the absolute level of interest rates, in the spread between two rates, in the shape of the yield curve or in any other interest rate relationship. Such changes usually affect securities inversely and can be reduced by diversifying (investing in fixed-income securities with different durations) or hedging (e.g. through an interest rate swap).
, of proposed amendments to International Accounting Standard (IAS) 39, Financial Instruments: Recognition and Measurement. The proposals (www.iasb.org.uk) would make it easier for entities to use fair value hedge accounting for a portfolio hedge of interest rate risk, also known as a "macro hedge." Comments are due November 14.
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Title Annotation:International
Publication:Journal of Accountancy
Date:Nov 1, 2003
Words:73
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