Hi sir,
"including a convertion loan note in equity on the basis that the holders are likely to choose the equity option on conversion." is not an example of faithful representation . I just wonder the reason.
Ask the Tutor ACCA FR
faithful representation
10y ago#1Because we have no control over the choice that will eventually be made by these lenders.
In whose opinion is it that the lenders will convert into equity?
What we DO know for sure is the value of the definite obligation - we know the present value of the money that we shall be paying as interest and we know the present value of the cash that will be paid if the equity option is not selected
Thank you:)
10y ago#3You're welcome
Sign in to reply to this topic.