11-20-2008, 03:13 AM
<font color="navy"></font id="navy"><font face="Verdana">I'd appreciate the senior members comments on a practical issue
A company is holding equity investments in listed securities which it has classified as Available for sale under IAS 39. The company recorded an impairment loss and fair value decrease of around 60 million and 13 million, respectively in the year 2006. Subsequently, in 2007, the market picked up and as at the year end for the 2007, the company's portfolio is depicting an increase of around 115 million. however, as we are aware,in 2008, the market prices again fell significantly, and the reversal is wiping all the fair value increase of 2007. Now while closing the books of accounts for 2007, can we book the fair value increase in the equity (fair value reserve), while we have substantial evidence of its reversal subsequently.
Best regards,</font id="Verdana">
A company is holding equity investments in listed securities which it has classified as Available for sale under IAS 39. The company recorded an impairment loss and fair value decrease of around 60 million and 13 million, respectively in the year 2006. Subsequently, in 2007, the market picked up and as at the year end for the 2007, the company's portfolio is depicting an increase of around 115 million. however, as we are aware,in 2008, the market prices again fell significantly, and the reversal is wiping all the fair value increase of 2007. Now while closing the books of accounts for 2007, can we book the fair value increase in the equity (fair value reserve), while we have substantial evidence of its reversal subsequently.
Best regards,</font id="Verdana">
