In this Accounting Alert we explore the IASB's proposals to amend the debt versus equity distinction in IAS 32 in relation to 'puttable instruments and obligations arising on liquidation'.

In our view, the proposals lack sufficient scope to address the common investor confusion arising in the Australian context surrounding unit trusts, co-operatives and similar entities. Many of these entities may still classify their 'equity' as a liability, even if the proposals go ahead.

Affected entities have until 22 September to make a submission to the AASB so that comments received can be taken into account in the AASB's own submission to the IASB which are due by 23 October 2006.

To read more, please download the PDF document in the attachments section below.

Links
IASB Exposure Draft of Proposed Amendments to IAS 32 Financial Instruments: Presentation and IAS 1 Presentation of Financial Statements: Financial Instruments Puttable at Fair Value and Obligations Arising on Liquidation
Special IAS Plus Newsletter – Proposed Amendments to IAS 32: Financial Instruments Puttable at Fair Value and Obligations Arising on Liquidation