IFRS No9 Is a Standard That Indicates Accounting for Investments When

question 153

Essay

IFRS No.9 is a standard that indicates accounting for investments when the investor does not have significant influence over the investee.
Required:
Explain how equity investments are accounted for under IFRS No.9.What alternative accounting approaches are available,what determines whether an investment qualifies for each approach,and what are the key features of each approach with respect to accounting for unrealized gains and losses?

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Definitions:

Reflex

An automatic, involuntary response to a specific stimulus without conscious thought.

Defense Mechanism

Psychological strategies brought into play by the unconscious mind to protect oneself from anxiety or social sanctions by distorting reality.

Intellectualization

A psychological defense mechanism where reasoning is used to block confrontation with an unconscious conflict and its associated emotional stress, by removing oneself emotionally from a stressful event.

Financial Implications

The potential economic outcomes or consequences associated with a decision, action, or event.