Marketable security classifications: AFS, trading, held to maturity (CFA Series: balance sheet)
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Uploaded by bionicturtledotcom on Feb 14, 2011
The key difference among the three classifications (available for sale; trading portfolio; and held to maturity) is the treatment of unrealized gains or losses. For example, assume a company owns a coupon-paying bond that increases in value due to a decline in interest rates:
* If trading portfolio, the value increase is recognized on the income statement as an unrealized gain and the balance sheet (i.e., Both B/S and I/S)
* If available for sale, the value gain is not recognized on the income statement but rather as other comprehensive income (OCI) under equity which, by definition, grows equity but not income (i.e., balance sheet only)
* If held to maturity, the unrealized gain is not recognized on either statement (Neither!)
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Uploader Comments (bionicturtledotcom)
All Comments (6)
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Hi David, thanks a lot for the video. You are the chosen one :) How I wish you had CFA coaching. Would be the first one to enroll :(
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You are the man!
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Hi David, very appreciate your video. Besides these three types, can you introduce the accounting of faire value hedge?
mogcai 1 week ago
@mogcai Thanks for the suggestion. I did just ADD it to our editorial calendar, thanks for your support!
bionicturtledotcom 1 week ago
Hola David:
Soy Ignacio Lopez de España. He visto todos tus videos, y quiero agradecerte el esfuerzo y el magnifico trabajo que has realizado. Simplemente alucinante. Muchas gracias
casonatorredequijas 11 months ago
@casonatorredequijas Ignacio, gracias por sus lindos comentarios, realmente me aprecian. Me alegro de que disfrutar de los videos.
bionicturtledotcom 11 months ago