Page 81 - F2 Integrated Workbook STUDENT 2019
P. 81
Financial instruments
Debt financial assets - amortised cost
If the financial asset passes:
Business model test
The entity’s business model is to hold financial assets until maturity.
Contractual cash flow test
The cash flows consist of interest and capital receipts only.
Then the financial asset can be classified and measured at AMORTISED COST.
Subsequent Treatment
Opening Interest Receipt (at Closing
balance (at effective rate %) coupon rate) balance
Year 1 X X (X) X
Year 2 X X (X) X
Dr Financial Asset Dr Cash
Cr Cash Cr Financial Asset
Dr Financial Asset Amortised cost
(SOFP)
Cr Investment
income (P/L)
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