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Fair value of investment in equity instrument

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FR Exams › Fair value of investment in equity instrument

  • This topic has 3 replies, 2 voices, and was last updated 3 years ago by AvatarP2-D2.
Viewing 4 posts - 1 through 4 (of 4 total)
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  • January 21, 2023 at 12:17 pm #677161
    Avatarxyzc
    Participant
    • Topics: 413
    • Replies: 175
    • ☆☆☆☆

    Why is the loss on fair value of investment in equity instrument pro-rated for inclusion in the consolidated statement of profit or loss .

    January 22, 2023 at 8:15 am #677197
    AvatarP2-D2
    Keymaster
    • Topics: 4
    • Replies: 7232
    • ☆☆☆☆☆

    It will state in the question that the gains/losses arise evenly over the year unless told otherwise. If we’re not told otherwise, which is likely the case here, then we pro-rate it.

    January 28, 2023 at 11:38 am #677526
    Avatarxyzc
    Participant
    • Topics: 413
    • Replies: 175
    • ☆☆☆☆

    But the loss on fair value of investment in equity instrument seems to be a capital loss and not revenue loss which seems to occur at a point in time like revaluation surplus and not over the year so how could it be pro-rated

    January 30, 2023 at 5:31 pm #677647
    AvatarP2-D2
    Keymaster
    • Topics: 4
    • Replies: 7232
    • ☆☆☆☆☆

    Agree but just follow as instructed in the question.

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