Under IAS 32, How Should an Equity Instrument Be Classified

question 38

Multiple Choice

Under IAS 32, how should an equity instrument be classified?

• A) It must always be classified as equity by its very nature.
• B) The entity has the option of classifying it as a liability or equity.
• C) If it contains a contractual obligation that meets the definition of a financial liability, it should be classified as a liability.
• D) The entity should apportion the classification between liability and equity if there is a contractual obligation that meets the definition of a financial liability.

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Definitions:

Workforce Diversity

Refers to the inclusion of individuals with a wide range of characteristics and experiences, such as cultural background, gender, age, and abilities, within a company's employees.

Flexibility And Accommodation

The ability and willingness to adjust or make concessions to meet others' needs or to adapt to changing circumstances.

Self-Managed Teams

Groups of employees who operate without a traditional managerial hierarchy, collectively assuming responsibility for their work and decision-making.

Full Potential

The highest level of performance or achievement one can attain, often realized through the full utilization of one's skills and talents.