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Forums › ACCA Forums › ACCA FM Financial Management Forums › CREDITORS HIERARCHY
Hello sir,
Please correct me if i am wrong, can we say that in company’s point of view from high risk to low risk it can be classified as below:
1- equity
2- preference share (equity)
3- unsecure debts
4- secure debts
And in investors point of view it is:
high risk to low risk
1- equity
2- preference share (equity)
3- unsecure debts
4- secure debts
Thanks
What you have written as being from the investors point of view is correct.
As far as the company is concerned it is not really relevant unless the company is going into liquidation (and then it is legal question relevant to Paper LW rather than relevant for Paper FM).