WorksheetsIFRS - Are we good to go - IFRS 9-W12
Total questions: 10
Worksheet time: 21mins
Linked transaction means 2 financial instruments are accounted for as a single combine instruments. Which of the following characteristics are not describes linked transaction?
whether they are entered into at the same time and in contemplation of each other
whether they have the same counterparty
whether they relate to the same risk
whether they relate to they have same amounts
In which of the following situations should Company A recognise a financial instrument
Company A plans to commit to the purchase of an interest rate swap
Company A entered into a cross-currency swap
Company A received a quote from the bank for the purchase of a foreign exchange currency forward contract
Company A enters into an agreement with Voyager-Co, which contains the following terms:
‒ Company A retains legal title to the financial asset
‒ Company A agrees to pass any cash flows generated by the financial asset immediately to Voyager-Co.
‒The agreement prohibits Company A from selling or pledging the financial asset.
During the period from collection to remittance, Company A places the cash flows received from the asset on short-term deposit and any interest earned is paid to Voyager-Co.
Does this transaction qualify as a transfer?
Yes
No
Further assessment
Risks and rewards tranferred of ownership. If all substantially all retained, what is the action?
Derecognise original financial asset
Continue to recognise
Recognise assets or liabilities created or retained in transfer
Control evaluation
Consider the following sale of the legal title of a financial asset for which no active market exists by Company A to Voyager-Co. Assume that Company A neither transfers nor retains substantially all the risks and rewards of ownership. Company A simultaneously buys a call option from Voyager-Co under which it has the right to repurchase the financial asset after five years. Voyager-Co has the legal right to sell the financial asset to another party. Does Company A retain control of the financial assets?
Yes
No
Depend
Consider the following sale of a part of a financial asset classified at amortised cost by Lila-Tech to Voyager-Co:
Original asset = loan
Part of the loan sold = 50% fully proportionate share of cash flows
Amortised cost of the entire loan = L$2,500
Proceeds received L$1,000
Calculate the gain/loss that Lila-Tech has to recognise ?
Loss $1,250
Gain $250
Gain $1,500
Loss $250
Under the general principle, which of measurement method applied for impairment of financial instruments?
12-month expected credit losses
48-month expected credit losses
24-month expected credit losses
36-month expected credit losses
Which of is the describe of low credit risk?
The financial instrument has a low risk of default
The borrower has a strong capacity to meet contractual cash flow obligations in the near term
The borrower has a neutral capacity to meet contractual cash flow obligations in the near term
Adverse changes in economic and business conditions in the longer term may, but will not necessarily, reduce ability of the borrower to fulfil its contractual cash flow obligations
In measuring of ECL, discount rate apply for financial assets is?
EIR (or an approximation) of the financial asset resulting from the loan commitment
Generally EIR of the financial asset or an approximation
Rate that reflects the current market assessment of the time value of money and the risks of the cash flows
Which statements is FALSE?
Expected credit losses are discounted to the reporting date
Expected credit losses are discounted to the expected default date
Impairment cannot be measured as the most likely outcome
EIR or its approximation can generally be used for discounting
