(Difference between pages)
imported>Doug Williamson |
imported>Doug Williamson |
| Line 1: |
Line 1: |
| 'Realisation' refers to the conversion of assets, profits or losses into cash.
| | The short-run decrease in earnings per share which occurs in a share for share exchange when a company trading on a lower price to earnings ratio acquires a company trading on a higher price to earnings ratio. |
| | |
| Realisation can occur either on the receipt or payment of cash, or at an earlier time when such receipt or payment of cash becomes virtually certain.
| |
| | |
| | |
| Generally accepted accounting practice allows the [[recognition]] of income and assets only when their realisation in the form of cash, or other assets that are readily realisable, can be assessed with reasonable certainty.
| |
| | |
| The concept of realisation arose for the protection of the creditors of companies, to ensure that sufficient cash was available to distribute profits without a company or other entity becoming insolvent.
| |
| | |
| | |
| Only realised profits may be distributed under company law.
| |
|
| |
|
|
| |
|
| == See also == | | == See also == |
| *[[Accruals basis]] | | * [[Bootstrap effect]] |
| *[[Accumulated other comprehensive income]] | | * [[Share for share exchange]] |
| *[[Contingent assets]]
| |
| *[[Crystallisation]]
| |
| *[[Distribution]]
| |
| *[[Recognition]]
| |
| *[[Revaluation]]
| |
| *[[Unrealised profit]]
| |
| | |
| [[Category:Accounting,_tax_and_regulation]]
| |
Revision as of 11:32, 22 June 2016
The short-run decrease in earnings per share which occurs in a share for share exchange when a company trading on a lower price to earnings ratio acquires a company trading on a higher price to earnings ratio.
See also
