Hedge accounting

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Challenges

Reducing P&L volatility with hedge accounting

Hedge accounting is an accounting method defined in IAS 39 and IFRS 9 for the recognition of hedging relationships. In principle, both 1:1 hedge relationships and portfolio hedges can be accounted for. The need for a separate accounting standard arises from the accounting mismatch that exists between the hedging instruments (derivative at fair value) and the hedged items (generally interest-bearing transactions at amortized cost). The application of hedge accounting is intended to resolve this mismatch and reconcile the accounting and economic perspectives. Furthermore, hedge accounting creates methodological consistency between accounting and the management activities in risk controlling.

Solutions

Hedge accounting with zeb.control

The following range of services from zeb.control enables you to master the challenges of hedge accounting with ease:

Support of iFRS cash flow and fair value hedge accounting as well as local GAAP hedge accounting managed at overall bank level.
Full support of controlling and treasury management processes, from rule- and optimization-based selection of transactions to the establishment of hedge relationships, to the execution of effectiveness tests, to the determination of accounting effects and subsequent plausibility checks.
The features also include extensive simulation options, audit-proof documentation of the hedge process and the competence system with logging.
Numerous customizable standard reports.
Regularly updated and always up to date with current supervisory requirements (e.g. for ongoing preliminary studies on DRM).

Video

Learn more about the versatile possibilities of zeb.control!

The following product video shows the extensive functions of the software and demonstrates exemplarily how you can access the multilayered possibilities from data import to configuration and analysis creation.