14 Risk related to counterparty failure to meet their obligation based on the initially agreed terms is referred to as:* A. Operational risk B. Funding risk C. Credit risk D. Fiduciary risk
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- 13. Identify the risks described in each statement: 1st: Dependent on the covenants set and agreed in between the lenders and the borrowers.2nd: Classified as a systematic risk because it arises from external forces or based on the movement of the industry. a. Legal; Market b. Market; Legal c. Contractual; Industry d. Industry; Contractual5. Changes in the fair value of the effective portion of a hedging financial instrument are recognized as a part of current earnings of the period for which of the following? Cash Flow Hedge Fair Value Hedge a. Yes Yes b. No Yes c. Yes No d. No No Multiple Choice a. b. c. d.18 -----is not included in the category of payment guarantee. A. Deferred payment bond B.Guarantee for compensation trade C. Loan guarantee D.Bid bond
- 30. The following statements are incorrect, except: a. Issued instruments are classified as liabilities or equity in accordance with the legal form of the contractual arrangement and the definitions of the financial liability and an equity instrument. b. A preference share that will be redeemed by the issuer for cash on a future date is a financial liability. c. IAS 37 prescribes the accounting and disclosure for all provisions, contingent liabilities and contingent assets, and those resulting from financial instruments that are carried at fair value. d. Issued instruments are classified as liabilities or equity in accordance with the management’s designation of the contractual arrangement.48. Which of the following is not an issue associated with liabilities?a. Reportingb. Identificationc. Valuation and Measurementd. AssessmentDetermine if this shall result in recognition of liabilities 12. violation of the terms of a contract; it is more likely than not that there will be outflow of resources, amount of such outflow can be reasonably estimated a. yes b. no
- 8. When accounting for contingent liabilities IFRS GAAP defines ‘probable’ as a. likely b. more likely than not c. possible d. none of these17.Which of the following statements is/are true?Statement I. Generally, the tenor of the investment also defines the riskiness of the repayment of debt.Statement II. The longer the life of the debt, the riskier the repayment. Hence, the interest rate is lower.Statement III. The term tenor describes the length of time remaining in the life of a financial contract. a. II only b. III only c. I and III d. II and III40. When an entity breaches an undertaking under a long-term loan agreement on or before the balance sheet date with the effect that the liability becomes payable on demand, (choose the incorrect statement) a. The liability is classified as non-current, even if the lender has agreed, after the balance sheet date and before the authorization of the financial statements for issue, not to demand payment as a consequence of the breach b. The liability is classified as current because, at the balance sheet date, the entity does not have an unconditional right to defer its settlement for at least twelve months after that date. c. The liability is normally classified as current; however, the liability is classified as non-current if the lender agreed by the balance sheet date to provide a period of grace ending at least twelve months after the balance sheet date, within which the entity can rectify the breach and during which the lender cannot demand immediate repayment. d. The…
- 4. Financial liabilities other than FVPL liabilities are initiallymeasured at fair value plus transaction costs.5. Amortized cost financial liabilities are subsequently measuredat the present value of the cash outflows from the instrument.6. Financial liabilities may be subsequently reclassified betweenthe amortized cost and fair value measurement categories.7. Trade payables and other liabilities that are part of an entity'sworking capital may be presented as current liabilities even ifthey are expected to be settled beyond one year.8. According to PAS 1, a currently maturing debt that the entity'smanagement intends to refinance is presented as noncurrent.9. According to PFRS 15, if an entity expects that a portion of giftcertificates sold will not be redeemed, the entity recognizes theexpected breakage amount as revenue in proportion to thepattern of rights exercised by customers.10. Unearned revenue is revenue that is earned but not yet collected Please answer this all. Thank youA risk-based deposit insurance program is defined as: a. A program that assesses the concentration risks of insured deposits. b. A program that assesses fines on the basis of capital adequacy and supervisory judgments. c. A program that uses market risk as the basis for deposit insurance premiums. d. A program that assesses insurance premiums on the basis of capital adequacy and supervisory judgments.21. Contingent assets need not be disclosed in the financial statements or the notes thereto if they are considered? * a. Virtually certain. b. Probable. c. Possible but not probable. d. Likely.