The Relative Importance of Various Asset Items on a Commercial

question 74

Multiple Choice

The relative importance of various asset items on a commercial bank's balance sheet reflects a bank's pursuit of which two conflicting goals?

• A) profits and risk
• B) liquidity and profits
• C) assets and liabilities
• D) buying and selling government securities

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Definitions:

Financial Assets

Assets that are cash, an equity instrument of another entity, a contractual right to receive cash or another financial asset, or a contract that will or may be settled in the entity's own equity instruments.

AASB 101

The Australian Accounting Standards Board statement that outlines the presentation of financial statements.

Share Capital

The capital raised by a company through the issuance of shares, representing the sum of the par value of these shares.

Disclosure

A requirement by corporations to provide shareholders and the public with accurate financial information, revealing the full financial performance and risks of the firm.