Amortized value is the recorded amount of a security, adjusted for any applicable amortization of premium or discount. The premium or discount is the excess or reduced amount, respectively, that an investor pays the issuer of a security, which adjusts the effective interest rate of the security that will be earned by the investor. Eventually, once all amortization has been recorded, the amortized value of a security will equal its face value. This amortized value appears on the balance sheet.
For example, a bond has a face value of $1,000, but investors buy it from the issuer for $950, in order to derive a greater effective interest rate. The issuer initially records the sold bond at its $950 sale price, and then gradually amortizes the $50 difference between the face value and sale price, until the recorded amount of the bond equals the face amount of $1,000. Thus, over the amortization period, the amortized value of the bond will gradually increase until it reaches $1,000.