off setting

commitments or forecasted transactions); (2) the derivative expires

or is sold, terminated, or exercised; (3) a hedged firm commitment
no longer meets the definition of a firm commitment; or (4)
management determines that designation of the derivative as a
hedge instrument is no longer appropriate.
When hedge accounting is discontinued because the hedged item no
longer meets the definition of a firm commitment, the derivative
will continue to be carried on the balance sheet at its fair value, and
any asset or liability that was recorded pursuant to recognition of
the firm commitment will be removed from the balance sheet and
recognized as a gain or loss in current-period earnings. When
hedge accounting is discontinued because it is probable that a
forecasted transaction will not occur, the derivative will continue to
be carried on the balance sheet at its fair value, and gains and losses
that were accumulated in other comprehensive income will be
recognized immediately in earnings. In all other situations in which
hedge accounting is discontinued, the derivative will be carried at
its fair value on the balance sheet, with changes in its fair value
recognized in current-period earnings.
Hedged oil and gas prices used in computing the year-end
standardized measure of discounted future net cash flows relating to
proved oil and gas reserves reflect the estimated effects of hedging
contracts existing at year-end.
Income