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Intercorporate Investments

Investments made by companies in other companies’ securities (equity or debt) to earn a return on idle cash or to enhance operations.

Fair Value Through Net Income (FVNI)

A classification of financial assets where investments are reported at fair value, with changes recognized directly in net income.

Amortized Cost (AC)

A classification for certain financial assets, particularly debt investments, measured at their acquisition cost less any impairment over time.

Fair Value Through Other Comprehensive Income (FVOCI)

A classification for investments where fair value changes are recorded in other comprehensive income and may be recycled into net income upon sale.

Significant Influence

The capacity to affect decisions of an investee company, typically associated with ownership of 20% to 50% of the voting shares.

Subsidiary

A company controlled by another company, usually defined by ownership of more than 50% of its voting shares.

Joint Arrangement

An arrangement where two or more parties have joint control over an economic activity.

Impairment

A reduction in the carrying amount of an asset when its fair market value is lower than its book value.

Equity Method

An accounting method used to report investments in associates where the investor recognizes their share of the investee’s profits and losses.

Accounting Anomalies

Irregularities in financial reporting that may indicate misstatements or fraudulent activity.

Expected Credit Loss (ECL)

The estimated loss expected on an investment due to default risk, calculated based on historical data and future expectations.

Market Valuation

The process of determining the current value of an asset or a company based on market conditions.

Control

The power to govern the financial and operating policies of an entity, usually signified by owning more than 50% of voting shares.

Transaction Costs

Expenses incurred when buying or selling an investment, which may be recorded differently depending on the investment classification.

Minority Interest

The portion of equity (ownership) in a subsidiary not attributable to the parent company, often disclosed separately in financial statements.

Consolidation

The process of combining the financial statements of a parent company and its subsidiaries to present as a single economic entity.

Risk Management

The process of identifying, assessing, and controlling threats to an organization's capital and earning potential.