CFA Level 2 FRA Comprehensive
Study Guide + Exam Questions &
Solutions Graded A+
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,Accounting for Investments - Answer:
Classifications of Financial Assets - Answer:
Reclassification of Financial Assets - Answer:
Impairment of Financial Assets - Answer: Held-to-maturity
(HTM) and Available-for-sale (AFS) securities be evaluated for
impairment at each reporting period.
,Held-for-trading and designated at fair value securities
because declines in their values are recognized on the income
statement as they occur.
GAAP
reversal of impairment losses is not allowed.
Impaired: security decline in value is determined to be other
than temporary
HTM/AFS: write-down to fair value is treated as a realized
loss.(I/S)
IFRS
recognized in I/S.
at least one loss event has occurred
HTM: carrying value is decreased to the present value of its
estimated future cash flows, using the same effective interest
rate that was used when the security was purchased.maybe
fair value.
Reversals of impairments are not permitted for equity
securities. Other can be reversed.
, Differences between IFRS and U.S. GAAP treatment of
intercorporate investments - Answer: Unrealized foreign
exchange gains and losses on available-for-sale securities are
recognized on the income statement under IFRS and as other
comprehensive income under U.S. GAAP.
IFRS permits either the partial goodwill or full goodwill
method to value goodwill and noncontrolling interest in
business combinations. U.S. GAAP requires the full goodwill
method.
The effects of the equity method versus the acquisition
method - Answer: NI same
Acquisition method equity will be higher by the amount of
minority interest.
Assets and liabilities are higher under the acquisition method.
Sales are higher under the acquisition method.
Study Guide + Exam Questions &
Solutions Graded A+
Professional Academic Assistance Services
Services Offered
• Proctored Exam Assistance
• Online Class Management (Full Course Support)
• Exam Preparation & Study Materials
• Assignments and Coursework Support
• Essay and Research Paper Writing
• Discussion Posts & Responses
• Editing and Proofreading
• Confidential Academic Consultation
Contact Information
Email:
WhatsApp link: https://wa.me/254704846336
Fast Response | Confidential | Reliable Academic
Support
Helping Students Achieve Academic Excellence
,Accounting for Investments - Answer:
Classifications of Financial Assets - Answer:
Reclassification of Financial Assets - Answer:
Impairment of Financial Assets - Answer: Held-to-maturity
(HTM) and Available-for-sale (AFS) securities be evaluated for
impairment at each reporting period.
,Held-for-trading and designated at fair value securities
because declines in their values are recognized on the income
statement as they occur.
GAAP
reversal of impairment losses is not allowed.
Impaired: security decline in value is determined to be other
than temporary
HTM/AFS: write-down to fair value is treated as a realized
loss.(I/S)
IFRS
recognized in I/S.
at least one loss event has occurred
HTM: carrying value is decreased to the present value of its
estimated future cash flows, using the same effective interest
rate that was used when the security was purchased.maybe
fair value.
Reversals of impairments are not permitted for equity
securities. Other can be reversed.
, Differences between IFRS and U.S. GAAP treatment of
intercorporate investments - Answer: Unrealized foreign
exchange gains and losses on available-for-sale securities are
recognized on the income statement under IFRS and as other
comprehensive income under U.S. GAAP.
IFRS permits either the partial goodwill or full goodwill
method to value goodwill and noncontrolling interest in
business combinations. U.S. GAAP requires the full goodwill
method.
The effects of the equity method versus the acquisition
method - Answer: NI same
Acquisition method equity will be higher by the amount of
minority interest.
Assets and liabilities are higher under the acquisition method.
Sales are higher under the acquisition method.
