CERTYNEX IFRS ACADEMY

A trainee at Corvel Bank classifies debt securities held to maturity as intangible assets, on the grounds that they lack physical substance and are held for the long term. What error does he make?

None: long-term securities without physical substance fall under IAS 38.

He forgets that financial assets are excluded from the scope of IAS 38.

He forgets that debt securities have physical substance.

He should have applied IAS 38 only if they were held for the short term.