IAS 33Chapter 5Lesson 2
A rights issue with a bonus element
Step 1 of 7Learning objectives
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A rights issue at a price below market contains a free part: it is treated as an issue for consideration, then an adjustment factor (price before rights / theoretical ex-rights price) restates the shares before exercise.
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Learning objectives
- Explain why a rights issue contains a bonus element.
- Calculate the theoretical ex-rights price and the adjustment factor.
- Restate the number of shares of prior periods and calculate the weighted average number for the year of the issue.