The perfect pitch (TT Oct05 p22-24)

IAS 39 Financial Instruments: Recognition and Measurement is a controversial accounting standard where there is yet no consensus. It represents a leap in complexity and a fundamental attempt to move accounting beyond the traditional historical cost-based system. As some startling examples have shown, this historical cost accounting is inappropriate in fast-moving financial markets. Strict hedging requirements force companies to document the thought process behind hedging transactions in a disciplined
fashion.