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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FR Exams › FVPL vs FVOCI
Hi Chris,
Why should a company want to choose to value financial assets on fair value through other comprehensive income rather than fair value through profit or loss?
Wouldn’t it always be better to have it through profit or loss so there is the option for the gain to be distributed to shareholders?
Hi,
It would be better if we were making gains but what if there was the potential to make losses over a prolonged period of time. It would be better to have those losses away from the profit or loss account. So if a risky investment or long term investment then maybe best as FVTOCI.
Thanks.