CHAPTER 14
Presentation and Disclosures
LEARNING OBJECTIVES
After studying this chapter, you will have a grasp of the following:
- How to record and report trade transactions of equity investments comprehensively.
- Similarities and differences between U.S. GAAP and IFRS in accounting for equity investments.
- Disclosure requirements for equity investments under U.S. GAAP.
- Disclosure requirements for equity investments under IFRS.
ACCOUNTING STANDARDS FOR PRESENTATION AND DISCLOSURE
Relevant Accounting Standards
| U.S. GAAP | IFRS |
| FAS 52—Foreign Currency Translation | IFRS 7—Financial Instruments: Disclosure |
| FAS 94—Consolidation of All Majority-owned Subsidiaries | IAS 21—The Effects of Changes in Foreign Exchange Rates |
| FAS 109—Accounting for Income Taxes | IAS 32—Financial Instruments: Presentation |
| FAS 115—Accounting for Certain Investments in Debt and Equity Securities | IAS 36—Impairment of Assets |
| FAS 130—Reporting Comprehensive Income | IAS 39—Financial Instruments: Recognition and Measurement |
| FAS 157—Fair Value Measurements | |
| FAS 159—The Fair Value Option for Financial Assets and Financial Liabilities |
PRESENTATION IN INCOME STATEMENT
Impairment of Securities
Temporary impairment of the equity securities that are held for trading is automatically tracked by valuing the securities at mark-to-market on every reporting day. Such temporary impairment is not to be recognized and acted upon for available-for-sale securities. However, if the impairment is anything other than ...
