Articles on Ind AS 32 – Presentation

What is a Financial instrument?

What is a Financial instrument? What is a Financial instrument? 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. The following financial instruments do not fall within the scope of Ind AS 32: Financial asset A financial asset is any asset that is: cash;an equity instrument of another entity;a contractual right:to receive cash or another financial asset from another entity; orto exchange financial assets or financial liabilities with another entity under conditions that are potentially favourable to the entity; ora contract that will or may be settled in …
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Observations about financial assets and liabilities

Observations about financial assets / liabilities Observations about financial assets / liabilities Chain of contractual rights / obligations: A chain of contractual rights or contractual obligations meets the definition of a financial instrument if it will ultimately lead to the receipt or payment of cash or to the acquisition or issue of an equity instrument. Cash: Cash is a financial asset because it represents the medium of exchange and is therefore the basis on which all transactions are measured and recognised in financial statements. Also, it is specifically included in the definition of financial asset. Bank deposit: A bank deposit is a financial asset …
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