Subsequent Measurement of Financial Assets

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..... e through profit or loss (FVTPL). Such classification is based on the following Two tests. Entity s business model for managing the financial assets and Contractual cash flow characteristics of the financial assets A. BUSINESS MODEL TEST: An entity's business model refers to how an entity manages its financial assets in order to generate cash flows. An entit .....

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..... cteristics if the financial asset is held: within a business model whose objective is to hold assets to collect contractual cash flows; or within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets. To do so, an entity is required to determine whether the asset's contractual cash flows are solely payments of principa .....

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