Final answer:
HTM securities are recorded as current assets when they are expected to be converted into cash within a year or the operating cycle.
Step-by-step explanation:
HTM securities are typically recorded as current assets in situations where they are expected to be converted into cash within one year or the operating cycle, whichever is longer.
For example, if a company owns HTM securities that are due to mature within a year and their intention is to sell them to obtain cash, they would classify these securities as current assets. This is because they have the ability to convert these securities into cash within a relatively short period of time.
However, if the company intends to hold the HTM securities for a longer period of time and their maturity dates are beyond a year or the operating cycle, they would classify these securities as non-current assets.