Certificate in Treasury Hedge Accounting

The Treasury Hedge Accounting course covers the intricacies of hedge accounting as per IFRS 9/Ind AS 109. This course uses a practical approach, through a discussion of various use cases and challenges faced in application of the hedge accounting and potential solutions.  

About the Course

CAFTA’s Certificate in Treasury Hedge Accounting (CTHA) is a course for participants who want to understand detailed concepts of IFRS 9/Ind AS 109, widely used hedge accounting strategies and its real-world application in treasury domain.

This hedge accounting course uses a practical approach through a discussion of various use cases, challenges faced in application of the hedge accounting and potential solutions.

After attending the program:

  • You will be able to apply hedge accounting to your derivative transactions and explain the principles to senior stakeholders
  • In a client facing role, you will be able to explain your clients the benefits / impacts of hedge accounting and the derivative transactions

Program highlights

Overview of derivatives

  • Need and use of derivatives
  • Various types of derivative instruments available for hedging
  • Understand how derivatives affect financial statements
  • Classification and accounting of derivatives instruments and its impact on financial statements

Objective and need for hedge accounting

  • Hedge accounting’s application by companies to
    • Align risk management activities to reflect in accounting
    • Reduce volatility in P&L statement
    • Mitigate accounting mismatch in measurement of financial Instruments

Application of hedge accounting in practice

  • Types of permitted hedge relationship such as Cashflow hedge, Fair Value hedge and Net investment hedge
  • Accounting implications of each hedge relationship
  • Pre-requisites of application of hedge accounting
    • Hedged item, hedging instruments, risk components, Layering etc
    • Eligibility criteria for designation in hedge relationship
    • Key aspects of hedge documentation
    • Hedge effectiveness testing requirements
  • Apply hedge accounting to different components of hedging instruments (forwards and options)
  • Criteria for highly probable forecast transactions

Hedge effectiveness methodologies

  • Concepts of economic relationship, hypothetical derivatives, rebalancing and hedge ratio
  • Different methods of assessing hedge effectiveness: Critical terms method, Dollar offset method, regression method
  • Key aspects while performing effectiveness testing
  • Role of credit risk in assessment of hedge effectiveness testing
  • Hedge accounting for rollover hedging strategy
  • Rebalancing of hedged item and hedged instrument

Discontinuation of hedge accounting

  • Scenarios which result in discontinuation of hedge accounting
  • Impact of discontinuation of hedge relationship

Practical scenarios in hedge accounting

  • Common challenges in application of hedge accounting such as mismatch in critical terms, hedge designation post trade date, etc.
Case studies
  • Currency risk: Designation of forward contract for hedge against highly probable sales
  • Currency and interest rate risk: Designation of cross currency interest rate swap (CCIRS) against external commercial borrowing
  • Commodity price risk: Designation of commodity futures contract against inventory
  • Currency risk: Designation of currency option contract against foreign currency term loan
  • Currency risk at subsidiary entity: Designation of Non-derivative financial instrument against net assets of a subsidiary

Program schedule

  • 8+ hours of recorded videos
  • 3 hours of live classroom interaction
  • Templates and case studies
  • 4 hours of live CAFTA’s FRM module

Who should attend?

  • Treasury manager/Treasury front-office
  • Treasury back office/accounting professionals
  • Finance manager/Finance controller
  • Internal/External auditor
  • Treasury/Derivative sales professional
  • Finance professionals interested derivatives and hedge accounting

Benefits on attending the program

  • Understand accounting impact of derivative / risk management strategies
  • Appropriately reflect risk management strategy in financial reporting
  • Use hedge accounting principals on derivatives to protect P&L volatility
  • Advice clients on appropriate derivatives in line with hedge accounting principles
  • Identify how derivatives are reflected in company's financial statements
  • Recognize links between risk management practices and financial reporting

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Registration fee

Fee (all prices are exclusive of 18% GST)

CAFTA members

Others

Combo pack (CTHA + CAFTA)

Early bird (Till 28st June)

INR 4,000

INR 6,000

INR 22,000

Normal fee

INR 5,000

INR 8,000

INR 25,000

Get FRM* module of CAFTA worth INR 5,000 Free with CTHA course

*Financial Risk Management (FRM) module, part of CAFTA program, is a live 4-hour session conducted on 10th July and 11th July from 10.30 a.m. to 12.30 p.m.

For more details about CAFTA, click here.

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