CERTYNEX IFRS ACADEMY

Zénith SA sold loans and derecognised them in their entirety. The contract leaves it with an option to repurchase these loans at a price set at 102% of their nominal value, different from their fair value on the day of repurchase (case facts). Is the option a continuing involvement to be documented?

No: any repurchase option is excluded from continuing involvement, whatever its exercise price, since the loans have been derecognised.

No: a repurchase option is a right relating to the transferred assets provided that the loans still appear in the statement of financial position.

Yes, but from the day the option is exercised; the mere faculty to repurchase creates no involvement as long as it is not exercised.

Yes: a retained contractual right relating to the transferred assets is continuing involvement; the exclusion of options at fair value does not apply to a price set at another level.