STOP Confusing Amortized Cost vs. FVTOCI! Business Model Test Explained

When I am classifying a financial asset, I must perform a business model test, which essentially means I need to determine my objective for holding that specific instrument. I have to decide whether I want to hold it forever, sell it when the price is right, or perhaps do both. This decision is what determines whether the instrument is measured at amortized cost, FVTOCI, or FVTPL. For instance, if I am holding a debt instrument and my objective is to keep it until maturity without selling it—meaning I will wait for the company to pay me the maturity amount—then I classify it as an amortized cost instrument. On the other hand, if I intend to sell it quickly to take advantage of fluctuations in interest rates and bond prices, I consider it an FVTPL financial instrument. If my intentions are unclear and I am open to either holding the instrument for its cash flows or selling it, then I classify that debt instrument as FVTOCI. -- Watch and Learn Concepts on the move! Join the live classes and watch backup for completed topics on the same day. What you get additionally? √Google Drive backup √Complete videos on Pen drive with validity till you clear your exam. √Books and Pen drive at your doorstep. Register for direct to home classes and leave all worries to us. Perks from Us: √ Latest Videos √ Voice Notes √ Multiple Views per video √ Free Extension of validity √ Free Amendments √ Queries resolved on Whatsapp √ Mock Tests √ Exam Mentoring and handling stress √ Continued support til you clear the exam .Play on Windows, Android and Macbook To know more: For enquiries WA To get a call bit.ly/3p6ZBeX #cmafinal #corporatefinancialreporting #cfr #cmacfr #startearly #stayahead #Caintermediate #caexams #cacoaching #caclassesonline #learnfromhome #learnwithsagc #facetoface #cainter #sudarshanagrawalclasses #mumbai #navimumbai #as #maharashtra #cainterclassess #accountingstandards#cmapendriveclasses #lease #CAFinal #CMAFinal #IndAS109 #FinancialReporting #SudarshanAgrawalClasses #SAGC #FRwithSudarshanSir #CAStudentLife #ICAI #FinancialAssets #BusinessModelTest #AccountingStandards #CMAInter #CAFinalFR #ConceptualClarity