Under IFRS, which of the following statements about hedging a foreign currency risk of an accepted purchase order is TRUE?
A)It can be accounted for using either a fair-value hedge or a cash-flow hedge.
B)It is not eligible for hedge accounting until it becomes an accounts payable.
C)It must be accounted for using a fair-value hedge.
D)It must be accounted for using a cash-flow hedge.

Question

Quizplus · Accepted Answer

Under IFRS, hedging a foreign currency risk of an accepted purchase order can be accounted for using either a fair-value hedge or a cash-flow hedge, depending on the nature of the risk being hedged and the company's risk management strategy.

Under IFRS, Which of the Following Statements About Hedging a Foreign