International accounting standards require mandatory redeemable preference share to be classified as a liability on the balance sheet and not as equity.

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According to International Accounting Standards, mandatory redeemable preference shares are considered as financial liabilities and should be classified as such on the balance sheet. They should not be classified as equity because they represent a contractual obligation that the company must fulfill, which makes them more akin to debt than equity.

International Accounting Standards Require Mandatory Redeemable Preference Share to Be