How banks can balance risks with results through hedge accounting

In the latest episode of the EY India Insights podcast, Hemal Shah discusses how hedge accounting helps banks better align risk management strategies with financial reporting. He explores the causes of earnings volatility, challenges in hedge effectiveness testing, and the governance needed to achieve consistent accounting outcomes in a volatile market environment.

Key takeaways:

• Why effective hedging can still create earnings volatility.
• How hedge accounting improves transparency and reporting outcomes.
• Key challenges around effectiveness testing and valuation differences.
• The importance of governance, documentation and ongoing monitoring.
• The value of collaboration across treasury, risk and finance functions.

Listen now to strengthen your hedge accounting strategy.