The transfer of a held-to-maturity investment in debt securities to either trading securities or securities available-for-sale would call into question the original designation of that investment.

Question

Quizplus · Accepted Answer

The transfer of a held-to-maturity investment in debt securities to either trading securities or securities available-for-sale would indicate that the original designation of that investment may have been incorrect or not followed properly. This is because held-to-maturity investments are intended to be held until maturity, while trading and available-for-sale securities are intended for short-term trading or potential sale. Thus, the transfer would suggest that the investor's original intention for the investment has changed, and may require reclassification or adjustment of financial statements.

The Transfer of a Held-To-Maturity Investment in Debt Securities to Either