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Description

Hedge Accounting: Qualifying, Documenting and Recognising Hedging Relationships

Qualify a hedging relationship and document it so that it withstands accounting review

  • 2 days — 14 h
  • In-person or virtual
  • Intermediate
  • Up to 6 participants

A derivative entered into to reduce an economic risk does not automatically produce the expected accounting outcome. Without qualification and documentation prepared at inception, fair value movements flow straight through profit or loss and amplify the very volatility the transaction was meant to correct. Discrepancies most often surface at the reporting close.

This short programme approaches hedge accounting from the angle of the file to be assembled. You identify the hedged item and the hedging instrument, distinguish hedging relationships according to the risk being addressed, draft the initial documentation, then monitor effectiveness through to discontinuation of the relationship and its accounting effects.

Learning objectives

  • Distinguish an economic hedge from a hedge eligible for hedge accounting treatment
  • Identify the hedged item and the hedging instrument in a transaction
  • Differentiate hedging relationships according to the nature of the risk addressed
  • Assemble the initial documentation of a hedging relationship
  • Monitor effectiveness and account for discontinuation of the relationship

What makes this programme different

Building a hedge documentation file document by document
A comparative treatment of an interest rate hedge and a foreign exchange hedge
The accounting entries for early discontinuation of a hedging relationship

Programme

1From Economic Risk to a Hedging Relationship

What makes a hedge eligible

  • Hedgeable risks and the instruments used to address them
  • A single hedged item or a group of homogeneous items
  • Types of hedging relationship according to the risk addressed
  • Eligibility conditions for hedge accounting treatment

2Documenting and Recognising

The file makes the hedge

  • Drafting the initial documentation and the risk management strategy
  • Measuring the hedging instrument and the hedged item
  • Recognising movements according to the type of relationship applied
  • Treating the ineffective portion of the hedge

3Managing the Relationship Over Time

Effectiveness monitoring and exit

  • Effectiveness testing and monitoring frequency
  • Rebalancing the hedging relationship
  • Voluntary or involuntary discontinuation of the hedge
  • Recycling to profit or loss of amounts recognised in equity
  • Disclosures to be provided in the notes

Who is it for

Financial controllers and consolidation specialists in banking institutions, together with treasurers, management controllers and auditors working on financial instruments.

Prerequisites

A sound understanding of derivative financial instruments and the ability to read financial statements.

Dates & locations

36 scheduled dates between November 2026 and December 2027. Seats are confirmed in the order enquiries are received.

November 2026

December 2026

January 2027

February 2027

March 2027

April 2027

May 2027

June 2027

September 2027

October 2027

November 2027

December 2027

None of these dates suit you? We open additional sessions on request, and any programme can be run privately for your team.

Practical details

Before the programme
Online positioning questionnaire. Your development objectives are shared with the trainer, who tailors the practical case studies to your context.
Teaching methods
Theoretical input, workshops and practical case studies. Digital course materials and method sheets provided.
Assessment
Multiple-choice tests and role-play exercises. Assessment of learning at the start and end of the programme, with immediate and 60-day follow-up evaluations.
After the programme
One year of access to the e-learning platform. Self-assessment of the skills acquired and a 30-day follow-up session with your trainer.
How to register
Registration online or on the basis of a quotation.
Lead time
11 working days after confirmation of registration.
Accessibility
Accessible to people of determination. Contact our accessibility coordinator to design a suitable solution: contact@mpf-academy.ae
Start dates
Rolling intake: in addition to the scheduled sessions, this programme can start on request.