An Entity Holding Both Financial Assets and Liabilities Is Allowed

question 21

Multiple Choice

An entity holding both financial assets and liabilities is allowed to offset and determine fair value on the net position as long as:
I they hold a net long position
II they hold a net short position
III they have a documented risk management strategy
IV the manage the group of net financial assets and liabilities on a net exposure basis
v.transactions are conducted in an orderly market

• A)I and III
• B)II and IV
• C)III and IV
• D)II and V

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Definitions:

Planning

The process of setting goals, defining strategies, and outlining tasks and schedules to accomplish these goals.

Managerial Position

A role within an organization responsible for overseeing operations, making decisions, and managing employees to achieve company objectives.

Flexible Work Schedules

Work arrangements that allow employees to vary their arrival and departure times, and/or choose their working hours, to accommodate personal needs and improve work-life balance.

Employee Motivation

The combination of internal and external factors that stimulate workers to take actions that lead to achieving work-related goals.