Explain to me like I am 5….. held for trading/maturity/for sale. unrecognized and recognized. IFRS and GAAP

How each impact the income statment and cash flow statment. This is one of the only things left tripping me up on FRA.

Held for trading-reported at fair value on the balance sheet, interest, dividends, realized and unrealized gains and losses are recognized on the income statement

Available for sale- reported at fair value on balance sheet, dividend, interest realized gains or losses recognized on income statement. unrealized gains or losses is recognized in other comprehensive income.

Held to maturity- reported at amortized cost on balance sheet. Only interest and realized gains or losses are reported on income statement.

As for the cash flow statement: when you buy them you have a CFI outflow, when you receive coupon payments or dividends you have a cash inflow (CFO under US GAAP, CFO or CFI under IFRS), and when you sell them you have a CFI inflow. It’s the same no matter how you designate them.

Thanks guys.

My pleasure.