Looking at my firm's Balance Sheet I found that most items made sense - certainly going through the relevant notes also helped.
But one item has left me confused!
I was interested to find out what “Available-for-sale
investments” were? They appeared in the non-current assets column.
After reading the relevant note (Note 20),
this item is basically an Investment that was owned by NCGA Holdings Limited, a company acquired by Boaxin.
Note 20 reads as follows:
"The
Company acquired NCGA Holdings Limited… on 1/12/12. The NCGA Group held a 26%
ownership interest if Qingdao Motors (H.K) Ltd and agreed not to exercise its
26% voting power. The investment was classified as an available-for-sale
investment accordingly.
The
available-for-sale investment was stated at cost less impairment because the
investment does not have a quoted market price in an active market and the
directors are of the opinion that the fair value cannot be measured reliably.
The Group does not have the intention to dispose of it in the near future."
After reading that, I’m just more confused! I
thought that it must have been an investment left over from the acquisition of
NCGA that Boaxin didn’t want to keep, so they were looking for a buyer for it.
But in the note it says the Group does not have the intention to dispose of it
in the near future? So why is it available for sale?
You are looking very in depth to this company which i love. I actually had a similar section but i still have no clue what it means.
ReplyDeleteI could not say 100% understand but so far, I could only think about this is the term when you describe some debt or equity not classified as a held for trading ,it is might be changes in value in comprehensive income within accounting period , and the company may be want to securities those items until to sold.
ReplyDeleteHi Benjamin,
ReplyDeleteThe terms can get quite confusing and I agree that the description provided by your company was a little baffling. Looking up the definition led to some complex waffle, but thankfully, I found some simple ones.
Have a look at these descriptions, as they may make more sense:
http://www.investopedia.com/terms/a/available-for-sale-security.asp
and another relatively clear definition:
http://financial-dictionary.thefreedictionary.com/Available+for+Sale
Hope this helps.
Regards,
Sheena
http://sheenalearnsaccounting.blogspot.com.au/