During period-end activities, which of the following amounts of the hedging instrument (HI) does the system post to equity (OCI)?

You have customized the system for hedge accounting under IFRS.

During period-end activities, which of the following amounts of the hedging instrument (HI) does the system post to equity (OCI)?
A . For cash flow hedges, the effective portion of the gain or loss of the HI
B . For cash flow hedges, the non-effective portion of the gain or loss of the HI
C . For fair value hedges, the effective portion of the change in fair value of the HI
D . For fair value hedges, the non-effective portion of the change in fair value of the HI

Answer: A

Explanation:

Under IFRS, the effective portion of the gain or loss on a cash flow hedge is recognized in other comprehensive income (OCI). This is done to match the timing of the recognition of the gain or loss on the hedged item, which is also recognized in OCI. The non-effective portion of the gain or loss on the hedging instrument is recognized in profit or loss.

For fair value hedges, the entire change in fair value of the hedging instrument is recognized in profit or loss. This is because the hedged item is also recognized at fair value in profit or loss.