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115 CFA
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115.040.04.03 Financial Analysis - Reading 22 - 3. Financial Instruments Financial Assets and Financial Liabilities

3. Financial Instruments: Financial Assets and Financial Liabilities

e. describe different types of assets and liabilities and the measurement bases of each;

What are some financial assets that are measured at fair market value?
- Financial assets held for trading.
- Available-for-sale financial assets.
- Derivatives (whether stand-alone or embedded in non-derivative instruments).
- Non-derivative instruments with fair value exposures hedged by derivatives.

What are some financial liabilities measured at fair market value?
- Derivatives.
- Financial liabilities held for trading.
- Non-derivative instruments with fair value exposures hedged by derivatives.

What are some financial assets that are measured at cost or amortized cost?
- Unlisted instruments (there is no reliable valuation measure).
- Held-to-maturity investments (bonds).
- Loans and receivables.


Source:
  • CFA
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