This case explores the accounting for investments in corporate bonds. The global setting involving a Swiss insurer investing in the Chinese yuan-denominated debt (i.e., “dim sum bonds”) of France-based Renault provides significant opportunity for secondary learning. The case can be used with “Dim Sum Bonds at Renault S.A.”(UVA-C-2373), which involves the accounting for bonds payable from the perspective of the issuer.The accounting for Helvetia's investments in this case could be undertaken from the perspective of US GAAP or IFRS, and assignment questions could be tailored to explore the accounting for these instruments as, alternatively, held-to-maturity investments, securities that are held-for-sale, or trading securities.The suggested questions to accompany the case require students to record the purchase of corporate bonds acquired at a premium to their face value, the receipt of interest payments, the recording of periodic interest revenue together with the associated amortization of the bond premium, as well as to address the issues of changing market values and a sale of the investment before the maturity of the bonds. Excerpt UVA-C-2387 Sept. 13, 2016 Helvetia Insurance's Dim Sum Bond Investment Robin Ming worked in the internal financial advisory group of Helvetia Insurance (Helvetia), a comprehensive insurance company subsidiary of Helvetia Group based in St. Gallen, Switzerland. Part of Ming's job was to seek out and evaluate investments to recommend to her superiors. While skimming an e-mail from the Renminbi Qualified Foreign Institutional Investor program (RQFII), a Chinese government initiative to encourage foreign investment in its capital markets, Ming had noticed something interesting. The storied French car manufacturer, Renault, had issued dim sum bonds on January 1, 2016. Apparently the firm was using the proceeds raised from this issuance to finance its growth in China. The bonds had been trading for a while when Ming first found the investment and brought it to her team's attention. After hammering out some of the risks and returns inherent in the bonds, Ming's team turned to the issue of accounting for this potential investment. If Helvetia were to invest in the dim sum bonds, what would the impact be on its financial statements? Dim Sum Bonds and Helvetia In an effort to promote the use of yuan in global trade, the Chinese government had allowed for commercial and government bonds denominated in Chinese yuan, which quickly became known as “dim sum” bonds, to be issued in Hong Kong and mainland China. The Chinese government gave companies, including foreign firms, the freedom to issue and sell dim sum bonds. The bonds became popular with investors looking to hedge their foreign exchange risk. By 2012, institutional investors based in Asia had become the largest group of investors in dim sum bonds. Demand for dim sum bonds had skyrocketed, which resulted in rapid growth in this market until about mid-2015. The dim sum market subsequently experienced some deterioration, but by the time Ming discovered Renault's dim sum bonds in 2016, the market was heating up again. . . .