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IFRS 9 FINANCIAL INSTRUMENTS (SUMMARY 2021), Initial Measurement,…
IFRS 9 FINANCIAL INSTRUMENTS (SUMMARY 2021)
Measurement
After initial recognition, an entity shall measure a financial asset in
accordance with paragraphs 4.1.1–4.1.5 at:
b) fair value through other comprehensive income
c) fair value through profit or loss
a) amortised cost
An entity shall measure a financial asset or financial liability at its fair value plus or minus, transaction cost directly attributable to the acquisition or issue of financial asset or financial liability
Derecognition of Financial Asset
When contractual rights to the cash flow from the financial asset aspire
When the entity transfers financial asset and risk and reward of ownership. The transfer must qualifies for derecognition.
Initial Recognition
When the entity becomes a party to the contractual provisions of the instrument
Regular way transaction
Trade date accounting (at the trade date)
Settlement date accounting
(at the settlement date as the asset)
Derecognition of Financial Liabilities
When it is extinguished which is discharge (delivered), Cancelled ( entity legally released from obligation), and Expires (due to the passage of time)
Classification of: :
Financial liabilites
at amortised cost
All other liabilties
at fair value through profit or loss
Held for trading
designated at FVTPL
Financial Asset
Business model
Objective = hold asset to collect contractual cash flows
Contractual cash flow characteristics
Cash flow on specified dates that are solely pricipal + interest
Initial Measurement
Subsequent Measurement