INTERNATIONAL FEDERATION OF RED CROSS AND RED CRESCENT SOCIETIES, GENEVA NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022 Page 15
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2.1 Income (continued) Lease income from operating leases is recognised in the Consolidated Statement of Comprehensive Income on a straight-
line basis over the lease term as described below:
Administrative over time
Income is recognised as and when monthly chargeable services are delivered
Fleet
over time Income from the provision of vehicles under operating leases is recognised on
a straight-line basis over the lease term
Income recognition policy Type of lease income Timing of income recognition (d) Other comprehensive income Other comprehensive income consists of items, such as actuarial gains or losses on defined benefit plan, that will not be
reclassified subsequently to operating income or expenditure, and items such as cash flow hedges, that may be reclassified
subsequently to operating income or expenditure.
Cash flow hedges Hedge instruments are used to mitigate foreign exchange risk associated with receiving statutory contribution payments
in foreign currencies. These are supported by hedge accounting to avoid an accounting mismatch, whereby the effects of
the changes in fair values of both hedge items and hedge instruments are appropriately measured, matched, and recognised
in the same period in the Consolidated Statement of Comprehensive Income.
When a derivative is designated as a cash flow hedging instrument, the effective portion of the changes in the fair value
is recognised in Other Comprensive Income and accumulated in a hedge reserve. An ineffective portion of changes in fair
value is recognised immediately in the Statement of Comprehensive Income. The amount accummulated in the hedge
reserve is also reclassified to the Statement of Comprehensive Income in the same period as the hedged item or forecast
cash flows affect income and expenditure.
