CAF-6 · Chapter 2 · Question 6 of 15
Under what specific condition can a financial asset that otherwise meets the strict criteria for amortised cost or FVOCI be designated as Fair Value through Profit or Loss (FVPL)?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) If doing so eliminates or significantly reduces an accounting mismatch.
Explanation
IFRS 9 allows an exception where a financial asset may be designated as FVPL, even if it meets the requirements for amortised cost or FVOCI, if it eliminates an accounting mismatch.
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