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The objective of hedging is to minimise the risk and/or to protect the profit. The objective of hedge accounting is to protect the profit and loss account from undue and unintended fluctuations in profit. Hedge accounting is not mandatory. However once a hedge is designated, it cannot be discontinued voluntarily so long as the hedging relationship meets the risk management strategy of the enterprise... IFRS 9 has replaced IAS 39 and has become effective with effect from 1st Jan 2018 in all geographical regions covered by IFRS Standards. Take a 10-day free course on basics of accounting for financial instruments