2009-11-25 Changes to Section 3855 Affecting the Accounting for Investments in Debt Securities and Loans and Receivables

Download

This newsletter contains a memorandum which addresses frequently asked questions on the interpretation and application of requirements in amended Section 3855, Financial Instruments - Recognition and Measurement.

In August 2009, the Accounting Standards Board amended the requirements in Section 3855, Financial Instruments – Recognition and Measurement (“Section 3855”) on accounting for investments in debt securities, such as government debt, corporate bonds, convertible debt, commercial paper, certain in-substance debt instruments such as term preferred shares, and securitized debt instruments. There have been consequential amendments to other aspects of Section 3855 that can affect the accounting for certain types of loans and receivables.

We address frequently asked questions that have arisen in connection with the interpretation and application of these amendments for those entities that account for investments under Section 3855 in the attached memorandum.