Global Standard Setter to Tweak Libor Hedge Accounting Relief

The International Accounting Standards Board clarified the scope of proposed exceptions to hedging rules as part of a package of amendments intended to help companies shift away from the benchmark interest rate known as Libor.

An estimated $300 trillion worth of contracts globally—including derivatives and mortgages—are tied to benchmark rates like the London Inter-Bank Offered Rate, which is set to expire in 2021.

The board’s Aug. 28 revisions and clarifications set the stage for issuing final amendments. The exceptions to existing hedge accounting rules are slated to take effect in January.

The board agreed to:

• allow companies to apply hedge ...