For a true and fair view, the joint presentation of hedged items and hedging instruments is essential. The limited application of hedge accounting under IFRS stems from strict requirements, some of which lack economic justification. The risk measure 'lower partial moment' (LPM) views risk as shortfalls from a benchmark, differing from traditional volatility. The interaction between hedge models and effectiveness tests should be examined both theoretically and empirically. An effective hedge model that considers this interaction yields better results than one that does not. Empirical studies across various commodity markets reveal that economically effective relationships often fail to qualify for hedge accounting under IAS 39. Additionally, the distribution moment in an LPM hedge model showed paradoxical responses in risk reduction measures, indicating that the quantitative assessments required by IAS 39 lack economic justification. The estimation window significantly impacts hedge effectiveness assessments, suggesting that the timing, frequency, and source of observations should be documented from the start of the hedging period to prevent manipulation. Furthermore, IAS 39 limits portfolio and macro hedging, as it regulates the composition of non-financial hedged items. A risk model for hedging combined risks like commodity prices and exchange rates cannot be applied under existing regulatory constraints. While micro hedging
