{"schema_version":2,"canonical_url":"https://asc.understandingaccounting.org/asc/815/30/#40-derecognition","source":"FASB Accounting Standards Codification, Basic View","usage":"Study and research edition. Verify current requirements with the official source. Summaries, enrichment, and tags are machine-generated study aids. Paragraph html preserves source markup; snippet is abbreviated. Pending content is not necessarily effective.","topic":"815","topic_title":"Derivatives and Hedging","subtopic":"815-30","subtopic_title":"Cash Flow Hedges","section":{"number":"40","label":"40 Derecognition","anchor":"40-derecognition","is_sec":false,"groups":[{"block":null,"heading":"Discontinuing Hedge Accounting","paragraphs":[{"citation":"815-30-40-1","para":"40-1","html":"
An entity shall discontinue prospectively the accounting specified in paragraphs 815-30-35-3 and
815-30-35-38 through 35-41
for an existing hedge if any one of the following occurs:
  1. a
    Any criterion in Section 815-30-25 is no longer met.
  2. b
    The derivative instrument expires or is sold, terminated, or exercised.
  3. c
    The entity removes the designation of the cash flow hedge.
","snippet":"An entity shall discontinue prospectively the accounting specified in paragraphs 815-30-35-3 and 815-30-35-38 through 35-41 for an existing hedge if any one of the following occurs:\n(a) Any criterion in Section 815-30-25…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:653ed19a13d605607788e55bc42ab6e28aa3eded301ee7d008eac350b18e4a47","downloaded_from":"2026-09-10T01:37:54.373Z","last_downloaded_at":"2026-09-10T01:37:54.373Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480933","source_sha256":"830ccb0ed3b66f21cb1e827349c1006ceaad3d3345d50f100cb2999c13adc7c1"}},{"citation":"815-30-40-1A","para":"40-1A","html":"
For the purposes of applying the guidance in paragraph 815-30-40-1, a change in the counterparty to a derivative instrument that has been designated as the hedging instrument in an existing hedging relationship would not, in and of itself, be considered a termination of the derivative instrument.
","snippet":"For the purposes of applying the guidance in paragraph 815-30-40-1, a change in the counterparty to a derivative instrument that has been designated as the hedging instrument in an existing hedging relationship would not…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:8b4a0980084dfc3c2172a0f390e95153fc017b1e051653148e44a344b884c514","downloaded_from":"2026-09-10T01:37:54.373Z","last_downloaded_at":"2026-09-10T01:37:54.373Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480933","source_sha256":"830ccb0ed3b66f21cb1e827349c1006ceaad3d3345d50f100cb2999c13adc7c1"}},{"citation":"815-30-40-2","para":"40-2","html":"
In the circumstances discussed in paragraph 815-30-40-1, the net gain or loss shall remain in accumulated other comprehensive income and be reclassified into earnings as specified in paragraphs 
815-30-35-38 through 35-41
. Example 16 (see paragraph 815-30-55-94) illustrates the application of paragraph 815-30-35-3 if a hedging relationship is terminated.
","snippet":"In the circumstances discussed in paragraph 815-30-40-1, the net gain or loss shall remain in accumulated other comprehensive income and be reclassified into earnings as specified in paragraphs 815-30-35-38 through 35-41…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:6c8e88291ae7057d6fc474fd809b4f4ae839e386808a156be4fd294a2bfda488","downloaded_from":"2026-09-10T01:37:54.373Z","last_downloaded_at":"2026-09-10T01:37:54.373Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480933","source_sha256":"830ccb0ed3b66f21cb1e827349c1006ceaad3d3345d50f100cb2999c13adc7c1"}},{"citation":"815-30-40-3","para":"40-3","html":"
Furthermore, the entity may elect to designate prospectively a new hedging relationship with a different hedging instrument or, in the circumstances described in paragraph 815-30-40-1(a) and 815-30-40-1(c), a different hedged transaction or a hedged item if the hedging relationship meets the applicable criteria for a cash flow hedge or a fair value hedge.
","snippet":"Furthermore, the entity may elect to designate prospectively a new hedging relationship with a different hedging instrument or, in the circumstances described in paragraph 815-30-40-1(a) and 815-30-40-1(c), a different h…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:44b6b8605764c87975bcfd34ccb8d145b81fa52006f0e01e01521ac3dc7745db","downloaded_from":"2026-09-10T01:37:54.373Z","last_downloaded_at":"2026-09-10T01:37:54.373Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480933","source_sha256":"830ccb0ed3b66f21cb1e827349c1006ceaad3d3345d50f100cb2999c13adc7c1"}},{"citation":"815-30-40-4","para":"40-4","html":"
The net derivative instrument gain or loss related to a discontinued cash flow hedge shall continue to be reported in accumulated other comprehensive income unless it is probable that the forecasted transaction will not occur by the end of the originally specified time period (as documented at the inception of the hedging relationship) or within an additional two-month period of time thereafter, except as indicated in the following sentence. In rare cases, the existence of extenuating circumstances that are related to the nature of the forecasted transaction and are outside the control or influence of the reporting entity may cause the forecasted transaction to be probable of occurring on a date that is beyond the additional two-month period of time, in which case the net derivative instrument gain or loss related to the discontinued cash flow hedge shall continue to be reported in accumulated other comprehensive income until it is reclassified into earnings pursuant to paragraphs
815-30-35-38 through 35-41
.
","snippet":"The net derivative instrument gain or loss related to a discontinued cash flow hedge shall continue to be reported in accumulated other comprehensive income unless it is probable that the forecasted transaction will not …","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:c229d95cdda1414b3264a736e132d8f2e697c40df411ab22e34561a3175b972f","downloaded_from":"2026-09-10T01:37:54.373Z","last_downloaded_at":"2026-09-10T01:37:54.373Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480933","source_sha256":"830ccb0ed3b66f21cb1e827349c1006ceaad3d3345d50f100cb2999c13adc7c1"}},{"citation":"815-30-40-5","para":"40-5","html":"
If it is probable that the hedged forecasted transaction will not occur either by the end of the originally specified time period or within the additional two-month period of time and the hedged forecasted transaction also does not qualify for the exception described in the preceding paragraph, that derivative instrument gain or loss reported in accumulated other comprehensive income shall be reclassified into earnings immediately. A pattern of determining that hedged forecasted transactions are probable of not occurring would call into question both an entity's ability to accurately predict forecasted transactions and the propriety of using hedge accounting in the future for similar forecasted transactions.
","snippet":"If it is probable that the hedged forecasted transaction will not occur either by the end of the originally specified time period or within the additional two-month period of time and the hedged forecasted transaction al…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:bae6d7ef6720e15301262c5e5ae0233d6a3e5c293078634aa611d908ad36a1bf","downloaded_from":"2026-09-10T01:37:54.373Z","last_downloaded_at":"2026-09-10T01:37:54.373Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480933","source_sha256":"830ccb0ed3b66f21cb1e827349c1006ceaad3d3345d50f100cb2999c13adc7c1"}},{"citation":"815-30-40-6","para":"40-6","html":"
Derivative instrument gains and losses that had initially been reported in other comprehensive income as a result of a cash flow hedge and then reclassified to earnings (because the entity subsequently concluded that it was probable that the forecasted transaction would not occur within the originally specified time period or the additional period of time described in paragraph 815-30-40-4) shall not later be reclassified out of earnings and back into accumulated other comprehensive income due to a reassessment of probabilities.
","snippet":"Derivative instrument gains and losses that had initially been reported in other comprehensive income as a result of a cash flow hedge and then reclassified to earnings (because the entity subsequently concluded that it …","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:464e4fa47cfc19e2e9c20d0be6d36f53a5e76bbdb4437bdbd6b02c201f919d1b","downloaded_from":"2026-09-10T01:37:54.373Z","last_downloaded_at":"2026-09-10T01:37:54.373Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480933","source_sha256":"830ccb0ed3b66f21cb1e827349c1006ceaad3d3345d50f100cb2999c13adc7c1"}},{"citation":"815-30-40-6A","para":"40-6A","html":"
When applying the guidance in paragraph 815-20-25-83A, if the hedged forecasted transaction is probable of not occurring, any amounts remaining in accumulated other comprehensive income related to amounts excluded from the assessment of effectiveness shall be recorded in earnings in the current period. For all other discontinued cash flow hedges, any amounts associated with the excluded component remaining in accumulated other comprehensive income shall be recorded in earnings when the hedged forecasted transaction affects earnings.
","snippet":"When applying the guidance in paragraph 815-20-25-83A, if the hedged forecasted transaction is probable of not occurring, any amounts remaining in accumulated other comprehensive income related to amounts excluded from t…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:d830b4d4cc0292398856d550d3d598748cd461e4396f3ec85965fb154a31963e","downloaded_from":"2026-09-10T01:37:54.373Z","last_downloaded_at":"2026-09-10T01:37:54.373Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480933","source_sha256":"830ccb0ed3b66f21cb1e827349c1006ceaad3d3345d50f100cb2999c13adc7c1"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:7e929b99fd7ee3557c2303fecf862f62a18a781259cebf2908179dad8549a614","downloaded_from":"2026-09-10T01:37:54.373Z","last_downloaded_at":"2026-09-10T01:37:54.373Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480933","source_sha256":"830ccb0ed3b66f21cb1e827349c1006ceaad3d3345d50f100cb2999c13adc7c1"}},{"block":null,"heading":"Alterations or Terminations of Offsetting Third-Party Derivative Instruments","paragraphs":[{"citation":"815-30-40-7","para":"40-7","html":"
Paragraph 815-20-25-62 provides guidance on internal derivatives as hedging instruments in cash flow hedges of foreign exchange risk. Paragraph 815-20-25-63 states that, if an issuing affiliate alters or terminates any offsetting third-party derivative instrument (which should be rare), the hedging affiliate prospectively shall cease hedge accounting for the internal derivatives that are offset by that third-party derivative instrument.
","snippet":"Paragraph 815-20-25-62 provides guidance on internal derivatives as hedging instruments in cash flow hedges of foreign exchange risk. Paragraph 815-20-25-63 states that, if an issuing affiliate alters or terminates any o…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:ae92bee364a7726813e76f5a23b81a5bbeffa590b699be69e86778bf2bbb3235","downloaded_from":"2026-09-10T01:37:54.373Z","last_downloaded_at":"2026-09-10T01:37:54.373Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480933","source_sha256":"830ccb0ed3b66f21cb1e827349c1006ceaad3d3345d50f100cb2999c13adc7c1"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:f1ba8c999cd9812c565f9a30ad1a986bdc2a96c1aa26c1c6ec546bafeb2e653d","downloaded_from":"2026-09-10T01:37:54.373Z","last_downloaded_at":"2026-09-10T01:37:54.373Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480933","source_sha256":"830ccb0ed3b66f21cb1e827349c1006ceaad3d3345d50f100cb2999c13adc7c1"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:039b5efa84d01c424fd62f742ba8dad32f82ea5dd92846c2f2cb29ace9037056","downloaded_from":"2026-09-10T01:37:54.373Z","last_downloaded_at":"2026-09-10T01:37:54.373Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480933","source_sha256":"830ccb0ed3b66f21cb1e827349c1006ceaad3d3345d50f100cb2999c13adc7c1"}},"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:039b5efa84d01c424fd62f742ba8dad32f82ea5dd92846c2f2cb29ace9037056","downloaded_from":"2026-09-10T01:37:54.373Z","last_downloaded_at":"2026-09-10T01:37:54.373Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480933","source_sha256":"830ccb0ed3b66f21cb1e827349c1006ceaad3d3345d50f100cb2999c13adc7c1"}}