Classification and Measurement of Financial Instruments: A Study of Divergence, Not Convergence

摘要

Financial instruments are defined as cash, evidence of an ownership interest in an entity, or contracts that obligate entities to exchange cash or another financial instrument.1 Under U.S. generally accepted accounting principles (GAAP), the measurement of a financial asset has depended on its legal form, a criterion that distinguishes between equity securities, debt securities, and loans, and upon the holder's intended use of a financial asset. During joint deliberations by the Financial Accounting Standards Board (FASB) and the International Accounting Standards Board (IASB), the Boards at one point tentatively agreed that the relevance of the information about financial assets in an entity's financial statements could be improved and a converged standard also could improve the comparability of that information across entities by focusing on the instrument's contractual cashflow characteristics and the entity's business model to classify and measure financial assets. While the IASB proceeded with this approach in finalizing its requirements on classification and measurement of financial assets,2 the FASB continues to deliberate the U.S. GAAP requirements, focusing more narrowly on minor changes to its classification and measurement standards with a continuing focus on the form of the instrument and management's intent.