Definition: Financial asset or financial liability at fair val...

Category: International accounting standards

A financial asset or financial liability at fair value through profit or loss is a financial asset or financial liability
that meets either of the following conditions.
(a) It is classified as held for trading. A financial asset or financial liability is classified as held for trading if it is: 
(i) acquired or incurred principally for the purpose of selling or repurchasing it in the near term;
(ii) part of a portfolio of identified financial instruments that are managed together and for which there is
evidence of a recent actual pattern of short-term profit-taking;
or
(iii) a derivative (except for a derivative that is a designated and effective hedging instrument).
(b) […] Any financial asset […] within the scope of this Standard may be designated when initially recognised as a financial asset […] at fair value through profit or loss except for investments in equity instruments that do not have a quoted market price in an active market, and whose fair value cannot be reliably measured. http://eur-lex.europa.eu/LexUriServ/site/en/oj/2004/l_363/l_36320041209en00010065.pdf