Question 5
ICAN
•
2025
•
CORPORATE REPORTING
•
mixed
Case Stimulus
Aribatise is a public liability company which holds a few financial instruments.
Requirements
(
a
)
Discuss how these transactions should be accounted for in accordance with IAS 32 and IFRS 9 in the financial statements to December 31, 2024.
(
b
)
An investment was made in the equity shares of Ojutiri Plc. 6,000 shares were purchased (a 1% stake) at a cost of N20 per share on April 1, 2022. A transaction fee of N600 was charged on the purchase. The firm intended to sell the shares within three months and so classed the investment as fair value through profit or loss. The market value of the investment continued to rise and so the company decided not to sell in the near future.
(
c
)
The company issued a convertible bond at par on December 31, 2024, raising N1,000,000. The coupon on the bond is 4%. The rate on an equivalent redeemable bond is 7%. The bond can be redeemed at par on December 31, 2027 or converted into equity shares at a rate of five shares per N200. The bond has not been classed as fair value through profit or loss.
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About This Question
This is
Ican
2025
Corporate Reporting
Question 5.
It is one of the
mixed
questions from the
2025
Ican
Corporate Reporting
examination.