Page 168 - SBR Integrated Workbook STUDENT S18-J19
P. 168
Chapter 12
Example 3
Fair value through profit or loss
On 1 January 20X1, Flora issued a financial liability for $10 million in order to
fund the purchase of short-term investments. The financial liability was
designated to be measured at fair value through profit or loss in order to
reduce an accounting mismatch.
At 31 December 20X1, the fair value of the liability had fallen to $9 million. The
fair value decline attributable to the change in Flora’s credit risk was $0.3
million.
How should the movement in the fair value of the financial liability be
accounted for in the year ended 31 December 20X1?
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