Measurement categories for financial assets
What are the principal measurement categories for financial assets?
Principal measurement categories for financial assets are amortised cost, fair value through other comprehensive income – FVOCI and fair value through profit or loss – FVTPL.
As per the previous version, viz, IAS 39, the financial assets were classified as one of the following, viz, (a) fair value through profit or loss –FVTPL; (b) available for sale; (c) held to maturity; and (d) loans and receivables. Out of all these, the last category, viz, loans and receivables are now not a measurement category. Held to maturity is now known as amortised cost albeit with significant variations. Available for sale category is removed and in that place, we have fair value through other comprehensive income – FVOCI. As per Ind AS 109, FVOCI category consists of two sub classifications, viz, one for equity instruments and the other for debt instruments with significant changes in treatment between the two.
