Q.3.2 Discuss technical insolvency and explain how this is different from absolute insolvency.

Q: Distinguish between losses from transaction exposure, operating exposure, and translation exposure?…

A: Investors get into contract for the future as well as the current transactions. The company will be…

Q: What is Insolvencey?

A: Liability: It is the legal financial debt owed by a company to outside entities that arises over the…

Q: 2. Define and describe a conflict of interest.

A: Solution Concept Conflict of interest                 The term conflict of interest means when there…

Q: Determine if this shall result in recognition of liabilities 15.Violation of the terms of agreement…

A: As per IAS 37, of IFRS Provisions, contingent liabilities and contingent assets If likelihood of…

Q: With the aid of examples, highlight the differences between the following terms: Rights issue and…

A: Solution:- Capitalization issue are also known as bonus issue. The following difference between…

Q: Determine if this shall result in recognition of liabilities 13. violation of the terms of a…

A: A liability is a obligation of entity which requires outflow of resources of entity for its…

Q: 7. How would you define transaction exposure? How is it different from economic exposure?

A: Exposure refers to the degree to which an individual or entity is subject to a particular risk or…

Q: How contract is discharged by subsequent impossibility?

A: Discharge of agreement or contract implies the end of the authoritative connection between the…

Q: Determine if this shall result in recognition of liabilities 12. violation of the terms of a…

A: As per IAS 37 of IFRS Provisions, contingent liabilities and contingent assets A Provision is a…

Q: How do the passive losses rules and the at risk rules work in conjunction to limit losses?

A: Passive losses: These are the losses that take place when expenses exceed the income in the passive…

Q: Which of the following liabilities would be considered nonrecourse?

A: "As the student have not been given the options to choose the nonrecourse liabilities, I will give…

Q: State difference between sureties and security?

A: In development contracts, if a worker for hire neglects to play out the works, the business would…

Q: Determine if this shall result in recognition of liabilities 14.Violation of the terms of a…

A: As per IAS 37 of IFRS Provisions, contingent liabilities and continent assets A contingent liability…

Q: Explain the Nonrecourse clause?

A: A sum of money that an individual or company owes is called liability. It is an obligation between…

Q: What happens if liability exceeds assets? What will happen and what does it mean?

A: The difference between the assets and the liabilities is said as the net worth. If the assets are…

Q: Distinguish between suspension of payments and insolvency.

A: Suspension of payment Suspension of payment implies temporary financial problems by enabling him/her…

Q: Assume that the interest rate on 1 year t-bill in Canada is .60% and the interest rate for similar…

A: Time Period = 1 Year Interest Rate of Canada = 0.60% Interest Rate of US = 1%

Q: Suppose the analysis of a loss contingency indicates that an obligation is not probable. What…

A: Contingent Liability  Contingent liability is one form of liability that arises based on a…

Q: If an investor has unique needs and does not care about liquidity, which contract is right for them:…

A: future contract is the contract which gives the obligation to the holder to buy or sell the…