Short selling securities in FVOCI portfolio

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Is anyone aware of any guidance within the IFRS that speak to an entity short selling securities sitting on the 'Fair Value through OCI (FVOCI)' portfolio.

The entity is holding government bonds in the FVOCI portfolio, and the trading desk would like to 'borrow' these securities from this portfolio and sell them externally, with the intention of buying back these securities from the market at a pre-agreed time and return them to the FVOCI portfolio.
 

bklynboy

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Isn't this a repurchase agreement then? We do this all the time to enhance yield and usually its a very short tail transaction (<30 days). I think you will find the guidance under repo's. I don't know IFRS but for GAAP the securities stay on the balance sheet and we set up a liability for the cash received since it will be paid back upon repurchase. There are collateral requirements on this as well that would need to be accounted for. Get the specifics of what they are doing to make sure they are repo's - I would be surprised if its a real short sale.
 

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