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21 November, 12:00

Which of the following are reported at fair value except trading securities: a) held-to-maturity securities b) available-for-sale securities c) all of these options are reported at fair value.

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  1. 21 November, 12:21
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    B. Available for sale securities

    Explanation:

    Available for sale securities refer to debt or equity instrument. They are purchased with a pre defined aim of selling them before their maturity, for profit earning. Such profit is usually a 'quick capital gain'. Apart from profit, they also assist for liquidity, repaying needs of companies.

    These equities are reported at 'fair value'. This implies that unrealised gains & losses are not included in earnings. They are rather recorded in a specific segregated item head 'accumulated other comprehensive income' of shareholder's equity.
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