Module 14.6 and 14.7: Accounting for Business Combinations
We can use the pooling of interest method, the pooling of interests methods or the acquisition method to account for …
Module 15.7 LOS 15.h: Accounting for share based compensation
Stock options are accounted for using a compensation expense based on the fair value of the options on the grant …
Module 15.6 LOS 15.e and 15.f: Analyst Adjustments for Evaluating a Pension Plan
To make comparative financial statement analysis easier, analysts can make several adjustments to pension accounting. Using net pension assets and …
Module 15.2 15.3, LOS 15.c: Components of the Defined Benefits Plan
The projected benefit obligation (PBO) [known as present value of defined benefit obligation (PVDBO) under IFRS] is the actuarial present value (at an assumed …
Module 15.5, LOS 15.d: Plan Assumptions and Effects of Changes in Assumptions, Ultimate Health Care Trend
The CFA recognizes 3 assumptions that firms use in pension calculations: The discount rate is the interest rate used to compute the …
Module 14.4 and 14.5: Investment in Associates – Equity Method and Acquisition Method
We use the equity methods for investment ownership of another company between 20-50%. This range is the usually considered influential …
Module 14.3 LOS 14.a: Reclassification Rules for Securities Held
Under IFRS, securities cannot be reclassified in or out of the Fair Value designation, it is considered irrevocable. Reclassification of …
Module 14.2 LOS 14.a: Reporting of Intercorporate Investments
Companies can passively own shares of securities as long as the investment ownership is less than 20%. These passive assets …
Module 11.2, LOS 11.e: Covered Interest Rate Parity and Uncovered Interest Rate Parity
Covered interest rate parity is the condition in which forward premiums or discounts are offset by interest rate differences between …
Module 11.2, LOS 11.d: Mark to Market Value of Forward Contract
The mark to market value is the difference between the locked in value of a forward contract and the current …