• Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar
Free ACCA & CIMA online courses from OpenTuition

Free ACCA & CIMA online courses from OpenTuition

Free Notes, Lectures, Tests and Forums for ACCA and CIMA exams

  • ACCA
  • CIMA
  • FIA
  • OBU
  • Books
  • Forums
  • Search
  • Register
  • Login
  • ACCA Forums
  • Ask ACCA Tutor
  • CIMA Forums
  • Ask CIMA Tutor
  • FIA
  • OBU
  • Buy/Sell Books
  • All Forums
  • Latest Topics

PQ Awards Nominations

Please help us to win one of the PQ Magazine awards and send in the voting form >>
You can nominate us in any or all of the following categories: Online College of the Year, Study Resource of the Year, Private Sector Lecturer of the Year, and Accountancy Personality of the Year.

Specially for OpenTuition students: 20% off BPP Books for ACCA & CIMA exams – Get your BPP Discount Code >>

Discounting down

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FR Exams › Discounting down

  • This topic has 5 replies, 2 voices, and was last updated 1 year ago by P2-D2.
Viewing 6 posts - 1 through 6 (of 6 total)
  • Author
    Posts
  • May 20, 2021 at 7:03 am #621162
    sartersanbor
    Member
    • Topics: 5
    • Replies: 5
    • ☆

    Hello,

    I am going through the Financial Instruments chapter and cannot understand why we discount down a covertible loan but we do not do this with the financial asset raising in the other entity. Can you please advise?

    Sara

    May 22, 2021 at 9:25 am #621407
    P2-D2
    Keymaster
    • Topics: 4
    • Replies: 6473
    • ☆☆☆☆☆

    Hi,

    Although you are not going to see this in the exam, from the investing perspective it does not matter whether you have an investment in shares or an investment in debt as both will be shown as an asset investment.

    This is obviously different from what we see from the issuers perspective that we see in the exam where the redemption is party for cash (debt) and shares (equity).

    Thanks

    May 28, 2021 at 6:44 am #621968
    sartersanbor
    Member
    • Topics: 5
    • Replies: 5
    • ☆

    Thanks but I still do not understand why we only do discount down from the issuer´s side…Can you please explain further?

    May 29, 2021 at 7:56 am #622106
    P2-D2
    Keymaster
    • Topics: 4
    • Replies: 6473
    • ☆☆☆☆☆

    Hi,

    We are discounting down from the issuers side as we are split accounting, treating part of the proceeds as debt and part as equity. The discounting is done to calculate the debt element.

    There might be some discounting on the acquisition side depending on the terms of the issue and if the instrument has been issued at a discount or with a premium on redemption but this is unlikely given the equity option.

    Thanks

    June 3, 2021 at 5:48 am #622864
    sartersanbor
    Member
    • Topics: 5
    • Replies: 5
    • ☆

    ok, many thanks for your reply

    June 3, 2021 at 9:48 pm #623010
    P2-D2
    Keymaster
    • Topics: 4
    • Replies: 6473
    • ☆☆☆☆☆

    You’re welcome, glad you’ve understood it.

  • Author
    Posts
Viewing 6 posts - 1 through 6 (of 6 total)
  • You must be logged in to reply to this topic.
Log In

Primary Sidebar

ACCA News:

 

ACCA My Exam Performance for non-variant Applied Skills exams is available NOW

NEW! Download the ACCA Pass Guide

FREE Verifiable CPD for ACCA Members

ACCA mock exams and debrief videos

ACCA Options:  “Read the Mind of the Marker” articles

Subscribe to ACCA’s Student Accountant Direct

Donate

If you have benefited from OpenTuition please donate.

ACCA CBE 2023 Exams

Instant Poll * How was your exam, and what was the result?

BT CBE exam was.. | MA CBE exam was..
FA CBE exam was.. | LW CBE exam was..

Specially for OpenTuition students

20% off BPP Books

Get BPP Discount Code

Latest comments

  • afital12 on FA Chapter 2 Questions The Statement of Financial Position and Statement of Profit or Loss
  • afital12 on FA Chapter 2 Questions The Statement of Financial Position and Statement of Profit or Loss
  • Iby2012 on Introduction to Financial Accounting – ACCA Financial Accounting (FA) lectures
  • John Moffat on Activity Based Costing part 1 – ACCA Performance Management (PM)
  • John Moffat on Introduction to Financial Accounting – ACCA Financial Accounting (FA) lectures

Copyright © 2023 · Support · Contact · Advertising · OpenLicense · About · Sitemap · Comments · Log in


We use cookies to show you relevant advertising, find out more: Privacy Policy · Cookie Policy