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Hie Mike,
May you please exlain to me why gains of the hedging instrument are credited to the statement of changes in equity.that is debit financial asset( e.g gain on forward contract) and credit equity. what is the logic behind this.Is this appreciation of the fact that nothing has been paid for nor does any liability exist?
Hi,
Yes, as the item has not yet been recognised it wouldn’t be prudent to recognise anything through profit or loss until it has been recognised.
Thanks
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