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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA SBR Exams › Financial Instruments
Sir in lecture video related to financial instruments, it has been stated that debt instruments should initially be measured at FVTOCI unless both the tests are satisfied wherein its then measured at Amortised cost.
However an article in ACCA website states this:
Debt instruments will be classified to be measured and accounted for at FVTPL unless they have been correctly designated to be measured at amortised cost.
So whats the right measurement basis?
All 3 classifications are possible but in most cases FVOCI or amortised cost.
FVPL sometimes used if there is an accounting mismatch – e.g. borrow money to finance investment property where changes in FV of both debt and IP would be in P&L