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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FM Exams › Financial gearing
Irredeemable preference share would be considered equity and Redeemable preference share will be considered as debt.
Actually in Kaplan it says considered preference shares as debt so I was confused between redeemable and irredeemable.
In financial accounts, your first sentence is correct as to how they are presented in the financial statements.
However for financial management they are treated as being debt.
So will consider both as debt no matter it is redeemable preference share or irredeemable preference share?
Correct (for Paper FM).
Thank you.
You are welcome.