Hedge accounting under IAS 39 and IFRS 9 - A critical comparison Dissertation

Hedge accounting under IAS 39 and IFRS 9 - A critical comparison - Dissertation Example IFRS 9 is still in its development phase and such studies help in changing accounting methods from a rules-focused approach to more of a principle- based view; this is done to encourage more personalities and institutions to apply hedging as it has benefits associated with good pricing and effective financial reporting. All the selected 32 hedge fund managers participated in the survey and the researcher’s contribution helped in bringing them up to speed with the scope of the study and ensured these participants were previously using IAS 39 for relevance purposes. The researcher also queried the achievements and financial performance across all accounting spectrum since these UK based hedge fund managers started applying IFRS 9. ... 41 Results 41 Demographics 41 Research Questions and Hypotheses 41 Quantitative aspects 42 Qulaitative analysis 45 CHAPTER 5: SUMMARY OF FINDINGS, CONCLUSIONS AND RECOMMENDATIONS 49 Summary of findings 49 Data collected revealed that a majority of the respondents were familiar with the provisions of IFRS 9 having encountered the instrument in their line of work. The proposed changes, therefore, had a direct effect on how the respondents and their organizations would operate upon full adoption. From the analysis of participant opinions, majority had in-depth knowledge of IFRS 9 and IAS 39 judging by the precision of their responses. This was attributed to both their routine responsibilities within the various Hedge Funds and level of education that inclined towards advance financial management for a majority of the sample population. It was therefore fair to form a preliminary conclusion that the respondents were authorities in their own individual rights within the region of hedge ac counting. 49 With the majority of respondents willing and ready to fully move from IAS 39 to IFRS 9, opening conclusions were drawn that the new system was found acceptable by the bulk of industry players making the instrument much better that IAS 39 on the strength of its acceptability. This was further supported by the present rate of the instrument’s application where it was revealed through the collected data, that 97% were actually enjoying larger provisions of the system. Revelations of IFRS 9 eliminating 80-125 effectiveness testing rule and hedging net options stood out as significant positive changes that the new instrument would bring upon adoption. 49 Conclusions 52 Recommendations 53 Bibliography 55 Abstract This study will seek to provide a