IAS 32 – Financial Instruments: Presentation – Theory – 2

Which of the following is meant by ‘entity’ in IAS 32?

A preference share that provides for mandatory redemption by the issuer for a fixed or determinable amount at a fixed or determinable future date, or gives the holder the right to require the issuer to redeem the instrument at or after a particular date for a fixed or determinable amount, is __________.

A contract to deliver as many of the entity’s own equity instruments as are equal in value to the value of 100 ounces of gold is __________ the entity must or can settle it by delivering its own equity instruments.

If an entity reacquires its own equity instruments, those instruments (‘treasury shares’) shall be deducted from equity.

Transaction costs of an equity transaction shall __________.

Changes in the fair value of an equity instrument shall __________.

The costs of an equity transaction that is abandoned shall __________.

Gains and losses related to changes in the carrying amount of a financial liability are recognised as income or expense in profit or loss __________ they relate to an instrument that includes a right to the residual interest in the assets of the entity in exchange for cash or another financial asset.

Offsetting a recognised financial asset and a recognized financial liability and presenting the net amount differs from the derecognition of a financial asset or a financial liability.

Under which of the following conditions shall an entity not offset a financial asset and a financial liability?