AC2101 S1 2014 Seminar 11 Financial Liability (Anil).pptx

Note we will see the application of this in seminar

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Unformatted text preview: use a valuation approach §༊  Non- performance risk needs to be considered (FRS 113 para 42) §༊  See Illustration 1 12 6 Financial Liabilities Measurement §༊  Others §༊  E.g. Issue a bond §༊  Initial Recognition (FRS 39:43) §༊  Fair value + TRANSACTION COSTS §༊  Subsequent Measurement (FRS 39: 47, 55, 56) §༊  Amortized cost @ effective interest rate §༊  Gains/losses to P/L when derecognized & thru’ amortization process §༊  See Illustration 2 13 31 /1 2/ x4 31 /1 2/ x5 Bond face value= Coupon Coupon $100K Int=$6K Int=$6K Cost=$104,330 Coupon rate=6% EIR=5% 31...
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This document was uploaded on 02/10/2014.

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