In Deciding Whether Financing with Receivables Is a Secured Borrowing

question 115

Multiple Choice

In deciding whether financing with receivables is a secured borrowing or a sale under IFRS, the critical element is the extent to which:

• A) The transferee has received substantially all the risks and rewards of ownership.
• B) The age of the receivables transferred differs from the average age of the receivables.
• C) The transferor of the receivable surrenders control over the assets transferred.
• D) The transferee relies on funds from the transferor to maintain operations.

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Definitions:

Sociocultural

Relating to the mix of social and cultural influences that shape a person's actions and viewpoints.

Psychodynamic

A therapeutic approach emphasizing the role of the unconscious mind, past experiences, and interpersonal relationships in shaping behavior and feelings.

Conditioning

A process of behavior modification by which a subject comes to associate a desired behavior with a previously unrelated stimulus.

Cognitive-behavioral

A therapeutic approach that aims to solve problems concerning dysfunctional emotions, behaviors, and cognitions through a goal-oriented, systematic procedure.