Table of Contents
What are financial instruments as per Ind AS?
Paragraph 11 of Ind AS 32 defines: A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity.
What are puttable financial instruments?
A puttable instrument is a financial instrument that gives the holder the right. to put the instrument back to the issuer for cash or another financial asset or is automatically put back to the issuer on the occurrence of an uncertain future event or the death or retirement of the instrument holder.
What are financial instruments as per ind as 109?
Measurement under IND AS 109 Financial Instruments
| Sl.No | Nature of Financial Asset | Interest Revenue calculation |
|---|---|---|
| 2 | Purchased Credit-impaired | Use credit adjusted EIR |
| 3 | Becomes Credit-impaired | Use EIR in subsequent period |
| 4 | Contractual cash flow Modified | Recalculate GCA and modify gain or loss in P&L |
Which contracts are not covered under Ind AS 32?
Thus, a conversion option embedded in foreign currency convertible bonds is treated as embedded derivative which is not the case under Ind AS 32. An equity instrument is any contract that evidences a residual interest in the assets of an entity after deducting all of its liabilities.
How many Ind As are there?
Presently, the Institute of Chartered Accountants of India (ICAI) has issued 39 Indian Accounting Standards (Ind AS) which have been notified under the Companies (Indian Accounting Standards) Rules, 2015 (‘Ind AS Rules’), of the Companies Act, 2013.
Is hedge accounting mandatory under Ind AS?
While hedge accounting is not mandatory under Ind AS 109, it may be applied to mitigate the accounting mismatch if the hedge relationship meets the qualifying criteria. The company is required to evaluate if it can designate and account for this hedge relationship as a cash flow hedge under Ind AS 109.
What is IND 105?
Ind AS 105 prescribes the accounting treatment for non-current assets held for sale and, and the presentation and disclosure of discontinued operations. It sets out the criteria for classification of a non-current asset (or disposal groups) as held for sale and discontinued operations.
What is a puttable instrument when will it be considered as an equity?
This requirement was removed in the final published version of the amendment. Instead an equity puttable instrument is now defined as one that entitles its holder to a pro rata share of the entity’s net assets in the event of the entity’s liquidation.
What are the different types of hybrid instruments?
One of the most popular types of hybrid instruments are: convertible bonds – one of the most popular type of hybrid instruments. Companies issue them to encourage investors with the opportunities of higher return.
What is an hyhybrid instrument?
Hybrid instruments are used safeguard creditors and depositors of a financial institution which is managed to offer a capital pillow to prevent any unexepcted losses coming from any operations of the issuer.
What is a hybrid financial instrument (hybrid contract)?
Differentiating the same with CFI; a hybrid financial instrument, or a hybrid contract is one which has an embedded derivative sitting on a host contract. From an investor’s point of view, a host contract can be of any kind, such as a financial asset or a non-financial asset.
What are hyhybrid securities?
Hybrid Securities are financial instruments that have mixed characteristics of two or more different financial instruments like stocks or bonds.