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Chapter 13: 4IFRS (page 658)

Which types of investments are valued at amortized cost? Explain the rationale for this accounting.

Short Answer

Expert verified

Held-for-maturity investments are valued as amortised costs.

Step by step solution

01

Definition of amortised cost

Amortised cost is known as the accumulated portion of the cost of a fixed asset. The amortised cost is charged against the asset as an expense.

02

Investment valued at amortised cost

Held-for-maturity is a type of investment valued at an amortised cost because this type of investment is held for more than one and does not report at fair value in the balance sheet. Hence. These securities are valued at amortised cost.

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