91 paragraphs found in INT 2
Paragraphs cited in the examples in the Appendix and in the paragraphs above show that, under IAS 32, the terms of the contractual agreement govern the classification of a financial instrument as a financial liability or equity. If the terms of an …
The IFRIC identified two situations in which a co-operative entity has an unconditional right to avoid the transfer of cash or another financial asset. The IFRIC acknowledges that there may be other situations that may raise questions about the …
The IFRIC also noted that an entity assesses whether it has an unconditional right to avoid the transfer of cash or another financial asset on the basis of local laws, regulations and its governing charter in effect at the date of classification. This is …
An entity may have the unconditional right to refuse redemption of a member’s shares. If such a right exists, the entity does not have the obligation to transfer cash or another financial asset that IAS 32 identifies as a critical characteristic of a …
The IFRIC considered whether the entity’s history of making redemptions should be considered in deciding whether the entity’s right to refuse requests is, in fact, unconditional. The IFRIC observed that a history of making redemptions may create a …
An entity may be prohibited by law or its governing charter from redeeming members’ shares if doing so would cause the number of members’ shares, or the amount of paid-in capital from members’ shares, to fall below a specified level. While each individual …
The IFRIC concluded that conditions limiting an entity’s ability to redeem members’ shares must be evaluated sequentially. Unconditional prohibitions like those noted in paragraph 8 of the consensus prevent the entity from incurring a liability for …
The IFRIC discussed whether the requirements in IAS 32 can be applied to the classification of members’ shares as a whole subject to a partial redemption prohibition. IAS 32 refers to ‘a financial instrument’, ‘a financial liability’ and ‘an equity …
The IFRIC noted that classifying a group of members’ shares using the individual instrument approach could lead to misapplication of the principle of ‘substance of the contract’ in IAS 32. The IFRIC also noted that paragraph 23 of IAS 32 requires an …
In many situations, looking at either individual instruments or all of the instruments governed by a particular contract would result in the same classification as financial liability or equity under IAS 32. Thus, if an entity is prohibited from redeeming …