Qualifying items
Financial instruments held within a business model whose objective is to collect or pay contractual cash flows
BC6.154 Against the background of potential interaction with the classification of financial instruments in accordance with IFRS 9, the IASB, in its deliberations leading to the 2010 Hedge Accounting Exposure Draft, considered the eligibility for hedge accounting of financial instruments held within a business model whose objective is to collect or pay contractual cash flows. The IASB focused on fair value hedges of interest rate risk because other risks (for example, foreign currency risk) affect cash flows that are collected or paid and the application of hedge accounting seemed clearly appropriate. More specifically, the IASB was concerned about whether a desire to enter into a fair value hedge can be seen as calling into question whether the entity’s business model is to hold the financial instrument to collect (or pay) contractual cash flows, instead of
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