Advanced Audit & Assurance (AAA)

Financial Assets

Equity instruments Debt instruments

1) FVTPL
 Default classification, and
 Held for trading

     Initial measurement:

At FV (transaction costs is expensed to P/L)

Subsequent measurement:

Re-measure to FV at y/e. Any changes in FV reported to P/L

2) FVTOCI
 Irrevocable choice upon initial recognition

Initial measurement:

At FV plus transaction costs

Subsequent measurement:

Re-measure to FV at y/e. Any changes in FV reported to OCI

 Advanced Audit & Assurance (AAA)
 

Financial Assets

Equity instruments Debt instruments

1) Amortised cost
 Business model is to collect contractual cash
flows (i.e does not plan to sell the asset until
maturity)
 Contractual cash flows => only interest &
principal

Initial measurement:

At FV plus transaction costs

Subsequent measurement:

Measure at amortised cost –

$
Initial investment X
Finance income (Effective interest %) X
Cash received (coupon % x nominal) (X)
Closing investment X

2) FVTOCI
 Business model is to collect contractual cash
flows & selling financial assets

Initial measurement:

At FV plus transaction costs

Subsequent measurement:

Re-measure to FV at y/e. Any changes in FV

reported to OCI

Will be reclassified to P/L when it is disposal.

3) FVTPL
 Default classification

Debt instruments that is not measured at

amortised cost or FVTOCI

Initial measurement:

At FV (transaction costs is expensed to P/L)

Subsequent measurement:

Re-measure to FV at y/e. Any changes in FV

reported to P/L