FAR 06-05 INVESTMENTS
I. General Definition (Investments) III. EQUITY INSTRUMENTS
- Assets -> property / financial instrument - Represents residual interests after d
- Primary Purpose: Accretion of wealth liability
- Rentals/Royalties - Ordinary Shares/Preference Shares
- Appreciation
- Interest Ordinary Shares
- Dividends
No control/
II. Financial Instruments < 20% PFRS 9
influence
- Contract: one entity has a financial assets No control but 20% -
- Counterparty entity: Financial Liability/Equity PAS 28
with influence 50%
• cash With control > 50% Sub
• Equity of another entity
Debt Instruments
• Right to receive cash /
another financial asset
Financial
• Right to exchange with
Assets Qualitative
Financial Liability
Considerations
(“potentially favorable” Equity Instruments
• Contract settled in own
shares
, No Control / Influence (< 20%)
I. Initial Recognition • Probable future benefits
• Measurable
• Should meet the definition of financial assets
II. Classification and Measurement (see illustration)
III. Presentation and Disclosure FVPL Current Asset
FVOCI & Unquoted Non-current Asset
IV. Special Transactions
Cash Income
Property Income @FV
a. Dividends
Stock Memo / Reclassifications (different type of
Liquidating Reduction in Investment
Accounted separately SR measured @ FV
b. Stock Rights
Not accounted separately Memo entry
I. General Definition (Investments) III. EQUITY INSTRUMENTS
- Assets -> property / financial instrument - Represents residual interests after d
- Primary Purpose: Accretion of wealth liability
- Rentals/Royalties - Ordinary Shares/Preference Shares
- Appreciation
- Interest Ordinary Shares
- Dividends
No control/
II. Financial Instruments < 20% PFRS 9
influence
- Contract: one entity has a financial assets No control but 20% -
- Counterparty entity: Financial Liability/Equity PAS 28
with influence 50%
• cash With control > 50% Sub
• Equity of another entity
Debt Instruments
• Right to receive cash /
another financial asset
Financial
• Right to exchange with
Assets Qualitative
Financial Liability
Considerations
(“potentially favorable” Equity Instruments
• Contract settled in own
shares
, No Control / Influence (< 20%)
I. Initial Recognition • Probable future benefits
• Measurable
• Should meet the definition of financial assets
II. Classification and Measurement (see illustration)
III. Presentation and Disclosure FVPL Current Asset
FVOCI & Unquoted Non-current Asset
IV. Special Transactions
Cash Income
Property Income @FV
a. Dividends
Stock Memo / Reclassifications (different type of
Liquidating Reduction in Investment
Accounted separately SR measured @ FV
b. Stock Rights
Not accounted separately Memo entry
