Advertisement
If you have a new account but are having problems posting or verifying your account, please email us on hello@boards.ie for help. Thanks :)
Hello all! Please ensure that you are posting a new thread or question in the appropriate forum. The Feedback forum is overwhelmed with questions that are having to be moved elsewhere. If you need help to verify your account contact hello@boards.ie
Hi all! We have been experiencing an issue on site where threads have been missing the latest postings. The platform host Vanilla are working on this issue. A workaround that has been used by some is to navigate back from 1 to 10+ pages to re-sync the thread and this will then show the latest posts. Thanks, Mike.
Hi there,
There is an issue with role permissions that is being worked on at the moment.
If you are having trouble with access or permissions on regional forums please post here to get access: https://www.boards.ie/discussion/2058365403/you-do-not-have-permission-for-that#latest

FRS 102 - Accrued coupon interest on Bond

  • 15-02-2017 11:06pm
    #1
    HcksawJimDuggan
    Registered Users, Registered Users 2 Posts: 394 ✭✭


    A company purchases a bond for €105 in June 2016. The bond has a par value of €100 and pays a coupon of €10 every September. At the time the bond was purchased (June 2016) the coupon interest accrued was €7.50.

    Under FRS 102, is the correct treatment to:
    1 - Book the cost of €105 to Investments & release the premium paid of €5 over the remaining Life of the bond using the effective interest rate

    Or

    2. Book the cost as €97.50 & €7.50 as a debit against coupon income (to reflect the interest accrued at the date of purchase)


Comments

  • #2
    occean
    Registered Users Posts: 1 ✭occean


    A portion of the 105 goes towards paying for the accrued interest receivable of 7.50.

    So, the FV of the bond investment is 97.50 which needs to be accreted until maturity date with the difference between EIR and coupon rate.


Advertisement