FAQs

Analysis 13
What is SPPI test?
What is SPPI Test? SPPI test means Solely Payment of Principal and Interest. The SPPI test is performed at the instrument level. So, if the test passes for one, it...
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Ipad 2
What is an embedded derivative?
What is an embedded derivative? What is an embedded derivative? An embedded derivative causes some or all of the cash flows that otherwise would be required by the contract to...
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London bridge 1
Is hedge accounting mandatory?
Is hedge accounting mandatory? Is hedge accounting mandatory or optional? Hedge accounting is not mandatory. However, considering the benefits of complying with hedge accounting, entities would want to follow hedge...
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Rupee 15
Carrying amount of a non-monetary item
Carrying amount of a non-monetary item How is the carrying amount of a non-monetary item determined on a valuation date for a foreign currency transaction? The carrying amount is determined...
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Business analytis 1
Contract meant for own use
Contract meant for own use Can a written option that results in the delivery of a non-financial item be treated as a financial instrument, as the non-financial item is meant...
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Cash 5
Classification of derivative instruments
Classification of derivative instruments How are derivative instruments classified? Derivative instruments are a subset of financial instruments. In the definition of financial asset, we have the following phrase, viz, “to...
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