CFM16220 - Accounting for financial instruments: IAS 32 and IAS 39: subsequent measurement of financial assets
Subsequent measurement
How financial assets are subsequently measured, and where gains or losses are recognised, depends on their classification:
| Asset | How measured | Treatment of gains or losses |
| At fair value through profit or loss (including held-for-trading) | Fair value | Through income statement |
| Loans and receivables | Amortised cost, using the effective interest method | Amortisation, and any impairment losses, go through the income statement. Disposal may give rise to a gain or loss, which is recognised in the income statement. |
| Held-to-maturity investments | Amortised cost, using the effective interest method. | As for loans and receivables. |
| Available-for-sale assets | Fair value | Interest is recognised in the income statement (using the effective interest method), as are any impairment losses. Fair value changes are recognised directly in equity, but are "recycled" into the income statement if the asset is sold or becomes impaired. |
| Derivatives (asset or liability) | Fair value | Through income statement, unless functioning as a hedge. |
This table does not apply to
- financial assets that are designated as hedged items, which are subject to measurement under the hedge accounting requirements ( CFM16265), and
- the treatment of foreign exchange gains and losses – see CFM16225.
Assets accounted for at amortised cost are subject to review for impairment. This is covered in more detail at CFM16230.
