Fair value through other comprehensive income-financial assets are classified and measured at fair value through other comprehensive income if they are held in a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets.O the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. O the asset is held within a business model whose objective is to hold assets in order to collect contractual cash flows and Amortised cost-a financial asset is measured at amortised cost if both of the following conditions are met:.When an entity first recognises a financial asset, it classifies it based on the entity’s business model for managing the asset and the asset’s contractual cash flow characteristics, as follows: At initial recognition, an entity measures a financial asset or a financial liability at its fair value plus or minus, in the case of a financial asset or a financial liability not at fair value through profit or loss, transaction costs that are directly attributable to the acquisition or issue of the financial asset or the financial liability. IFRS 9 requires an entity to recognise a financial asset or a financial liability in its statement of financial position when it becomes party to the contractual provisions of the instrument. IFRS 9 specifies how an entity should classify and measure financial assets, financial liabilities, and some contracts to buy or sell non-financial items. The new standard will apply from 1 January 2018, but early application is allowed. The main new features include a new model of "classification and measurement", impairment, hedge accounting and own credit. The IASB published the final version of IFRS 9 in July 2014 replacing IAS 39. After the start of the economic crisis in 2008, the IASB decided to issue the standard IFRS 9 with a particular attention to calssification and measurement of financial instruments.
Later, the ever-changing of markets and the creation of new financial instruments, has involved a number of improvements and additions to the accounting standard IAS 39, until 2007. In December 1998, the International Accounting Standards Board (IASB), the main institution responsible for international accounting standards, issued the accounting standard IAS 39 with the aim to define the principles for the recognition, measurement and disclosures of financial and non-financial instruments.
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