Bookkeeping

How to record investment funds

I’m investing in new business ventures, how do I record these at what I invested or what they are worth. I’m not actively looking to sell, but if someone came looking to buy all or a part of my position on most of them I would consider selling. Thank You!

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    Hi there when you make the initial investment it should be recorded as an asset at cost (the amount you invested). Also, I should say the investment I am assuming is property (land, building, fixed assets). You can opt to remeasure the value yearly based on the fair value model (IAS40), but the change in the value must be recognized on the Profit & Loss statement. Also, remeasurement has to be consistent. If you choose to revalue your investment, this must be reviewed annually for impairment. You can not start at cost, revalue the assets, then go back to cost. The method must be consistent. Further with US GAAP when you find the asset has been impaired and you write down (or reduce) the value, if the set appreciates (increases in value) you can not under any circumstances go back and increase the value. International Financials Reports Standards (IFRS) does allow for upward valuations. Please let me know if you have additional questions on this topic.

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