Subsidiary B could designate the external debt as a hedge of the GBP/
USD risk of its net investment in Subsidiary C in its consolidated financial statements. Parent could maintain Subsidiary B’s designation of that hedging instrumen
t as a hedge of its US$300 million net investment in Subsidiary C for the GBP/USD risk (see paragraph 13) and Parent could designate the GBP hedging instrument it holds as a hedge of its entire £500 million net investment in Subsidiary B. The first hedge, designat
ed by Subsidiary B, ...[+++]would be assessed by reference to Subsidiary B’s functional currency (pounds sterling) and the second hedge, designated by Parent, would be assessed by reference to Parent’s functional currency (euro).