Wiley GAAP 2014: Interpretation and Application of Generally Accepted Accounting Principles

19   ASC 320 INVESTMENTS—DEBT AND EQUITY SECURITIES

Perspective and Issues

Subtopics

Scope and Scope Exceptions

Overview

Practice Alert

Definitions of Terms

Concepts, Rules, and Examples

Debt Securities and Equity Securities with Readily Determinable Fair Values

Classification of investment securities

Presentation

Fair Value Readily Determinable

Held-to-Maturity Debt Securities

Transfers

Sales within three months of maturity date

Example of held-to-maturity debt securities

Trading Securities

Example of accounting for trading securities

Example of accounting for a realized gain on trading securities

Available-for-Sale Securities

Example of available-for-sale equity securities

Example of available-for-sale debt securities

Deferred Income Tax Effects

Transfers between Categories

Measurement

Example of a transfer between trading and available-for-sale portfolios

Example of a transfer between available-for-sale and trading portfolios

Other-than-Temporary Impairment (OTTI)

Scope

Unit of accounting

Step 1—Determine whether the investment is impaired

Step 2—Evaluate whether the impairment is other than temporary

Recognition of an other-than-temporary impairment

Example of other-than-temporary impairment of an available-for-sale security

Example of temporary impairment

Subsequent measurement after recognition of an OTTI

Income statement presentation

Example of income statement presentation of OTTI

Subsequent accounting for debt securities after recognition of OTTI

Cost-Method Investments ...