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IAS 7 – Short term deposits under cash and cash equivalents

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FR Exams › IAS 7 – Short term deposits under cash and cash equivalents

  • This topic has 1 reply, 2 voices, and was last updated 3 years ago by P2-D2.
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  • May 10, 2022 at 3:29 pm #655339
    farheenkadeeja
    Member
    • Topics: 7
    • Replies: 18
    • ☆

    Should the fixed deposits with maturity of more than 3 months be classified under cash and cash equivalents, if the remaining maturity is below 3 months as of reporting date? As the asset can be liquidated within 3 months of the reporting period, ideally it should be under cash and cash equivalents right?

    May 16, 2022 at 8:15 pm #655841
    P2-D2
    Keymaster
    • Topics: 4
    • Replies: 7231
    • ☆☆☆☆☆

    The standard does not look at a specific length of time. It defines it as short-term, highly liquid investments that are readily convertible for cash. If the above meets that definition then it is a cash equivalent.

    Thanks

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