Review of Chart of Accounts †Philippines Essay

Review of Chart of Accounts Philippines Questions and Suggested Answers 1. In China GAAP, the bonds or stocks purchased argon categorized as Held-for-business or Available for sale or Long term investment, based on the purpose of purchase. Does Philippine GAAP have similar miscellanea? Philippine client want to separate the marketable securities to current or non-current, it means 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 ? transaction securities (debt or equity securities) o o ? ? Financial assets at fair value through profit 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 i nvestments are classified as all current (short-tem) or noncurrent (long-term) assets. The account 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 more than one year. Debt Trading securities Available-forsale v v impartiality v v Current v Noncurrent Current or Noncurrent v Maybe classified as current or noncurrent depending on whether they are intended to be held within 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 expected to be realized within twelve (12) of the balance sheet date.Noncurrent financial assets are investments other than current investments. This residual definition means that the noncurrent investments are intended to be held for more than one year or are not expected to be realized within t welve months after the end of the reporting period. Trading Securities or Held-for-trading Securities The first category of financial assets chthonian PAS 39 is called financial assets at fair value through profit or loss. This category includes two types of financial assets, they are A. Financial assets that are held for trading or popularly known as trading securities