Existing asset or liability as a hedged item
Only an existing asset or liability can be designated as a hedged item in a fair value hedge. Do you agree?
This statement is not correct, as the hedged item in a fair value hedge can be in addition to the above an unrecognised firm commitment or an identified portion of an asset, liability or firm commitment that is attributable to a particular risk and could affect the income statement.
The hedge of a firm commitment to buy or sell a financial or non-financial asset is accounted for as a fair value hedge provided the economic relationship of hedging meets the risk management objective of the enterprise and fulfils other qualifying criteria.