IAS 32 · Workpapers (Step 4 of 5)
Workpaper assignment
- Course
- Exercises
- Case studies
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- Exams
Classification of an issued instrument: financial liability, equity instrument or compound instrument: Redeemable units A
Offsetting, puttable instruments, cooperative member shares and the FICE project: a classification and presentation file
Section 1 of 7
Objective
Section brief
- What to document
- The engagement, its scope and the working mode chosen.
- Why
- A workpaper answers one precise question: framing it avoids off-topic work.
- How
- Read the objective and the assignment, then choose the mode (guided, semi-guided, professional).
- Expected result
- You know which question the workpaper must settle, and for which reporting date.
- Your role
- Preparer of the IAS 32 workpaper
- Level
- Expert
- Estimated time
- ≈ 60 min
- Progress
- 0 / 3 steps done (review excluded)
Context
Orsan Cooperative (fictitious entity) groups farmers. It has issued member shares and redeemable fund units, holds grain contracts and has balances with two counterparties. You prepare the classification and presentation note for the closing date of 31 December 20X6.
Assignment
Classification of the member shares and the redeemable units of Orsan
Purpose of the workpaper
Record the contractual terms of the instrument, the settlement clauses, the contingent events, the currency of the exercise price and, where relevant, the redemption rights of the holder. The classification rests on these terms, not on the intention of the parties or the name of the instrument; amounts and terms are case data and the classification remains a supported judgment.
Questions of the file covered by this workpaper
- Classify the member shares M1 and M2.
- Classify the redeemable units A and B.
- Do the liquidation units fall under the same exception as the A units? What difference in conditions?
- Compute the total of the instruments classified as equity.
- Compute the total of the instruments classified as financial liabilities.
Documents in the file
Open the documents to pick out the relevant information.