A financial asset is derecognized when the entity's rights to the cash flows from the financial asset expire or the entity transfers the financial asset.

Question

Quizplus · Accepted Answer

A financial asset is derecognized from an entity's balance sheet when the entity has either transferred the rights to receive cash flows from the asset, or those rights have expired, indicating the entity no longer controls the economic benefits associated with the asset.

A Financial Asset Is Derecognized When the Entity's Rights to the Cash