Amortized Cost and Impairment – An Application

The amortized cost of a financial asset or financial liability is the amount at which it is measured on initial recognition, less any repayments made, plus or minus the cumulative amortization (using the effective interest method) of any difference between the initial amount and the maturity amount, and less any reduction for impairment or uncollectible (IAS 27, paragraph 5). This work aims to present a review of the topic and a concrete application, showing how this topic can be worked on.