The FASB has issued a proposed Accounting Standards Update (ASU), Derivatives and
Hedging (Topic 815): Fair Value Hedging — Portfolio Layer Method. The
proposal would “expand the current single-layer model to allow multiple-layer hedges
of a single closed portfolio of prepayable financial assets or one or more
beneficial interests secured by a portfolio of prepayable financial instruments
under the method.” In addition, the “last-of-layer” method would be renamed the
“portfolio layer” method.
Comments on the proposed ASU are due by July 5, 2021. For more information, see the
press release on the FASB’s Web site.