Problem
You have recently been employed as a Senior Investment Officer at a leading university that is known to have huge cash reserves. As part of your fact finding you realize most of the excess funds are held in bank accounts. In your recent Investment committee, you explained alternative investment options for the University but the Committee chairman has asked you to clarify about the accounting approaches for the various investment options. In your presentation you had talked about;
a. Fair value through profit and loss
b. Amortized cost
c. Fair value through other comprehensive income
d. Equity Method
e. Consolidation Required
Briefly explains the meaning of each accounting approaches mentioned and in which circumstances it is applied.