Measurement of financial assets: classification into amortised cost, FVTOCI or FVTPL dictates accounting treatment and equity exception.

Financial assets are measured at Amortised Cost where held to collect contractual cash flows, FVTOCI where held to collect cash flows and sell, or FVTPL where held for trading; equity instruments lack solely principal-and-interest cash flows and are therefore measured at FVTPL unless an irrevocable election to present fair value changes in OCI is made. Financial liabilities are initially measured at fair value and thereafter generally at Amortised Cost, with only derivative liabilities held for trading and financial guarantees measured at FVTPL.

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