Question

Is this under the scope of IFRS 9?

Hi, 

Anyone interested in helping me with this question?

I'm thinking it's a derivative but because of the word "delivery" I'm not too confident.

On 1 November 20X1 Johnson took out a speculative forward contract to buy coffee beans for
delivery on 30 April 20X2 at an agreed price of $6,000 intending to settle net in cash. Due to a surge in expected supply, a forward contract for delivery on 30 April 20X2 would have cost $5,000 on 31 December 20X1.
Required
Discuss, with suitable calculations, how the above financial instruments should be accounted for
in the financial statements of Johnson for the year ended 31 December 20X1.  

Thanks in advance

Answer 1

I think it's derivative under ifrs 9

Comments

Yes it is. Thank you very much.

I had missed the part where they mentioned that Johnson is an Investment property company.