What is the accounting for investments in mutual funds?

Posted by admin
vitaly.korzhik asked:


Hi, I’m interested in IFRS accounting policies for investments in the units of mutual funds.
In my case, the mutual fund invests in some illiquid long-term assets like construction projects and property.
Any ideas would be highly appreciated!

ERICK
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This entry was posted on Monday, December 21st, 2009 at 10:43 am and is filed under Other - Business & Finance. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.

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One Response to “What is the accounting for investments in mutual funds?”

  1. RANDALL Says:
    December 22nd, 2009 at 8:30 pm

    GARLAND

    Presumably the intention at the outset is to hold these investments for long term. These would be classified as Available-for-sale financial assets (AFS assets). The initial recognition is to record the acquisition at cost (which would be the fair value at that time). At each subsequent balance sheet date, they are measured at the fair value, with any fair value changes recognised directly in equity, through the statement of changes in equity, NOT in the income statement. When the AFS assets are derecognised, the accumulated fair value changes previously taken to equity would be taken to the income statement.