Accounting Standard for Financial Instruments

Securities NOT classified as trading, held-to-maturity, or subsidiary/affiliate investments fall into this RESIDUAL "OTHER SECURITIES" category (その他有価証券, generally translated "Available-for-Sale"). They are measured at FAIR VALUE, but UNREALISED gains/losses are recognised WITHIN Net Assets – specifically within the "Valuation and Translation Adjustments" component (see the companion ASBJ Statement No. 5 poster) – rather than flowing through the Statement of Income, UNTIL the security is SOLD or otherwise disposed of (or impaired), at which point the ACCUMULATED amount is "recycled" through profit or loss.

Internationally, IFRS REPLACED its OLDER financial instruments standard, IAS 39 – with its FOUR-category classification model broadly SIMILAR in STRUCTURE to J-GAAP's current approach – with IFRS 9, which introduced a FUNDAMENTALLY different classification APPROACH (based on an entity's BUSINESS MODEL and the instrument's CONTRACTUAL CASH FLOW CHARACTERISTICS, rather than management's stated HOLDING INTENTION) and a FORWARD-LOOKING EXPECTED CREDIT LOSS impairment model (replacing the OLDER incurred-loss approach). ASBJ Statement No. 10 has NOT undergone an equivalent comprehensive overhaul – J-GAAP's classification model REMAINS conceptually CLOSER to the OLDER IAS 39 four-category structure than to IFRS 9's current approach. This is a RECURRING pattern seen elsewhere in this poster series (UK GAAP's FRS 102 retaining a simplified, pre-IFRS-9-style approach; FRS 103's insurance model predating IFRS 17) – once an international standard MOVES ON, a NATIONAL standard historically converged with an EARLIER version doesn't always immediately follow. NOTABLY, the ASBJ HAS been actively engaged in REVISING this Statement in RECENT periods (including exposure drafts and a revised standard issued during 2025–2026), suggesting this may be an AREA of ONGOING reform – though the FULL extent and final shape of any such revision should be confirmed against ASBJ's current published materials.