U.S.GAAP and IFRS require firms to classify derivatives as

Name: U.S.GAAP and IFRS require firms to classify derivatives as
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Question

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Both U.S.GAAP and IFRS allow firms to classify derivatives as fair value hedges or cash flow hedges depending on the underlying risk being hedged. Additionally, if the derivatives do not meet the criteria for hedge accounting, they must be classified as not a hedging instrument. Therefore, option E is the best answer as it includes all possible classifications.

USGAAP and IFRS Require Firms to Classify Derivatives as