Review of Chart of Accounts †Philippines Essay

Review of Chart of Accounts Filipinos Questions and Suggested Answers 1. In China GAAP, the bonds or stocks purchased atomic number 18 categorized as Held-for- handicraft or obtainable for sale or Long term investment, based on the purpose of purchase. Does Philippine GAAP have similar categorization? Philippine client want to separate the marketable securities to current or non-current, it representation short or long term, right? Answer The Philippine pecuniary Reporting Standards (PFRS) based from International Financial Reporting Standards (IFRS) classifies Investment in Bonds and Investments in Stocks as financial assets.For this purpose, investments in bonds or stocks are classified as ? Trading securities (debt or equity securities) o o ? ? Financial assets at lovely value through realise or loss by requirement Financial assets at fair value through profit or loss by designation Available-for-sale securities (debt or equity securities) Held-to-maturity securities (debt securities only) These investments are classified as either current (short-tem) or noncurrent (long-term) assets. The describe name Long-term investment is not among the financial assets classification in PFRS.Current investments are investments that are by their very nature are readily realizable and are intended to be held for not to a greater extent than one social class. Debt Trading securities Available-forsale v v Equity v v Current v old Current or Noncurrent v Maybe classified as current or noncurrent depending on whether they are intended to be held inwardly one year or for more than one year v Held-tomaturity v 2 For instance, trading securities are normally classified as current assets because these investments are pass judgment to be realized within twelve (12) of the balance sheet date.Noncurrent financial assets are investments other than current investments. This residual definition nitty-gritty that the noncurrent investments are intended to be held for more than one year or are not expected to be realized within twelve months after the end of the reporting period. Trading Securities or Held-for-trading Securities The head start category of financial assets under PAS 39 is called financial assets at fair value through profit or loss. This category includes both types of financial assets, they are A. Financial assets that are held for trading or popularly known as trading securities