A Fair Value Hedge That Meets the Requirements Under AASB

Multiple Choice

A fair value hedge that meets the requirements under AASB 139 for hedge accounting is accounted for in which of the following ways?

A) Any gain or loss on the hedged item attributable to the hedge risk is recognised in the profit and loss
B) Any gain or loss from re-measuring the hedging instrument at fair value or its foreign currency amount is recognised as equity
C) When a firm commitment to acquire an asset is entered into and it is a hedged item, the initial carrying amount of the asset should never include the cumulative change in fair value of the commitment previously recognised in the balance sheet
D) None of the above describes the correct accounting for a fair value hedge