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+--- Thread: Impairment of Investments held in AFS (/showthread.php?tid=10494)
Impairment of Investments held in AFS - ahsanalpha - 10-17-2011
Kindly confirm the treatment of impairment of Bond held as AFS
Before Impairment (asset is a Bond)
Asset at Fair Value 90
Asset Face Value 100
Fair value deficit (in equity) 10
When impaired entry is made
________________________________________
Impairment expense (In PnL) DR 10
Deficit on fair value (In equity) Cr 10
________________________________________
While the asset is still at 90 and there is no Provisioning liability, if further provisioning is not required.
kindly confirm
- kamranACA - 10-17-2011
Your entry is correct.
Regards
- hmmm - 01-13-2012
when cost assume is 100 and f.v is 90 then deficit will be i profit & loss
Impairment Loss 10 dr.
Investment 10 cr.
ithink so it will not be adjusted in equity.
RE: Impairment of Investments held in AFS - blue_oceans79 - 12-24-2014
(10-17-2011, 12:46 PM)ahsanalpha Wrote: Kindly confirm the treatment of impairment of Bond held as AFSEntry you have mentioned is incorrect. AFS impairment shall be taken to pl straight away.
Before Impairment (asset is a Bond)
Asset at Fair Value 90
Asset Face Value 100
Fair value deficit (in equity) 10
When impaired entry is made
________________________________________
Impairment expense (In PnL) DR 10
Deficit on fair value (In equity) Cr 10
________________________________________
While the asset is still at 90 and there is no Provisioning liability, if further provisioning is not required.
kindly confirm