Financial liability: Difference between revisions
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1. | |||
A contractual obligation either to: | |||
*Deliver cash or another financial asset to another entity; or | *Deliver cash or another financial asset to another entity; or | ||
*Exchange financial assets or financial liabilities with another entity under conditions that are potentially unfavourable to the reporting entity. | *Exchange financial assets or financial liabilities with another entity under conditions that are potentially unfavourable to the reporting entity. | ||
2. | |||
A contract that will or may be settled in the reporting entity's own equity instruments, and is either: | |||
*A non-derivative for which the entity is or may be obliged to deliver a variable number of the reporting entity's own equity instruments; or | *A non-derivative for which the entity is or may be obliged to deliver a variable number of the reporting entity's own equity instruments; or | ||
*A derivative that will or may be settled other than by the exchange of a fixed amount of cash or another financial asset for a fixed number of the reporting entity's own equity instruments. | *A derivative that will or may be settled other than by the exchange of a fixed amount of cash or another financial asset for a fixed number of the reporting entity's own equity instruments. | ||
Revision as of 12:25, 13 May 2016
IAS 32 defines a financial liability as liability that is any of the following:
1.
A contractual obligation either to:
- Deliver cash or another financial asset to another entity; or
- Exchange financial assets or financial liabilities with another entity under conditions that are potentially unfavourable to the reporting entity.
2.
A contract that will or may be settled in the reporting entity's own equity instruments, and is either:
- A non-derivative for which the entity is or may be obliged to deliver a variable number of the reporting entity's own equity instruments; or
- A derivative that will or may be settled other than by the exchange of a fixed amount of cash or another financial asset for a fixed number of the reporting entity's own equity instruments.
