The holding gains and losses that arise from items (assets/ economic resources) that are still held or liabilities still owed in a reporting period. Non-realized holding gains constitute an increase in the value of an asset (s) that a business continues to hold. Whereas, non-realized holding losses represent a decrease in that value.

Such financial results are, under normal conditions and accounting conventions, classified as not realized- that is, their effect will not be reflected in or charged to an entity’s statement of income. However, if an entity applies the concept of capital maintenance, non-realized holding gains and losses can be classified as income.

Non-realized holding gains and losses are also known as paper holding gains and losses.