Accounting Requirement for Investment

Running head: FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Name of the Student
Name of the University
Author Note

1
FINANCIAL ACCOUNTING
Memorandum
To: Angela Kirk
From: Ross Kirk
Date: 25th August 2019
Subject: Accounting Requirement for Investment
The AASB 9 which deal with the analysis of Financial Instrument in the company, it show all
the activities which the company have to ascertain about the difference of financial asset and
financial liability (Aasb.gov.au. 2019). As per AASB 9 the debt instrument is consider as
financial asset in the company and the company should able to consider the same in recording
the debt instrument in the company. Company should record the same in the initial
requirement and should able to give proper amount of disclosure in their annual report so the
company financial user is able to know how they have done the valuation in the company
business.
In paragraph 4.2.2 the company should able to record the same in the fair market price value
of the asset in the initial recording of the same as it should also be get affected by the
amortise cost in the company financial statement (Ariff & Safari 2015). It should able to get
proper amount of information about the fair value which will help the company to record the
asset easily in the company financial statement. The company should also able to check the
amount of value of asset and should record the same in their financial statement.
Company should able to record initial at fair value but it should also take into consideration
about the profit and loss effect in the asset (Buchanan 2016). As the asset is been utilized for
2 years than the company is able to record the same. These may affect the overall valuation of
company so it may happen due to the interest affect the company have to record it below or