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NOTES RECEIVABLE
Initial measurement at PRESENT
VALUE.
SHORT-TERM notes receivableFACE VALUE
LOAN RECEIVABLE
Initial measurement at FAIR VALUE
plus TRANSACTION COSTS that are
directly attributable to the acquisition.
(i.e Direct origination costs/ origination
fees)
FAIR VALUE is normally the
TRANSACTION PRICE, meaning, the
amount of loan granted.
Subsequent measurement
(BUSINESS MODEL) at AMORTIZED
COST using the EFFECTIVE
INTEREST METHOD
The amortized cost is the amount
at which the receivable is measured
initially minus principal repayment,
plus or minus the cumulative
amortization of any difference
between the initial amount
recognized and the principal
maturity amount, minus reduction
for impairment or uncollectibility.
If the initial amount recognized is
lower, than the principal amount,
the amortization of the difference is
added to the carrying amount.
If the initial amount recognized is
higher, than the principal amount,
the amortization of the difference is
deducted to the carrying
amount.
INVENTORIES
Measured at LOWER OF COST or NET
REALIZABLE VALUE (LCNRV)
If the cost is lower than net
realizable value- the inventory is
stated at cost and the increase in
value is not recognized.
BIOLOGICAL ASSET
PAS 41 is applied to agricultural
produce AT THE POINT OF
HARVEST.
Initial measurement :
BIOLOGICAL ASSET at FAIR VALUE
less COSTS to SELL
AGRICULTURAL PRODUCE at FAIR
VALUE less COSTS to SELL at the
POINT of HARVEST in all cases and
can always be measured reliably.
Fair value measurement stops AT
THE TIME OF HARVEST.
FINANCIAL ASSET
Initial measurement at FAIR VALUE
plus TRANSACTION COSTS that are
directly attributable to the
acquisition.
Initially, an entity may designate a
financial asset as measured at fair
value through profit or loss even
the financial asset satisfies the
measurement at amortized cost.
Subsequent measurement at FAIR
VALUE or AMORTIZED COST
depending on the entitys business
model for managing financial assets.
Classification of Financial
Asset:
A. Financial assets at Fair value
B. Financial assets at amortized
cost
The FAIR VALUE of a financial
asset is usually the TRANSACTION
INVESTMENT IN ASSOCIATE
INVESTMENT PROPERTY
Initial measurement at COST.
Includes TRANSACTION COSTS.
Comprises its purchase price and any
directly attributable expenditure.
(i.e professional fees for legal
services, property transfer taxes and
other transaction costs.
Subsequent measurement either
at:
(A) FAIR VALUE MODEL- carried at FAIR
VALUE. No depreciation recorded.
(B) COST MODEL- carried at COST less
any accumulated depreciation
and any accumulated
impairment losses.
DERIVATIVES
Measured at FAIR VALUE
subsequent accumulated
impairment loss.
COST OF ASSET ACQUIRED ON
ACCOUNT
-invoice price minus the discount
whether taken or not.
ON INSTALLMENT- cash price
equivalent. Excess recognized as
interest expense over the credit
period.
-no established cash price, equal
to the PRESENT VALUE of all
installment payments using market
rate of interest.