What is the appropriate treatment for convertible notes in accordance with AASB 132 "Financial Instruments: Presentation"?
A) as a financial liability;
B) as equity;
C) as part debt and part equity;
D) as a financial liability and disclosure of conversion option;
E) None of the given answers.

Question

Quizplus · Accepted Answer

Convertible notes are treated as compound financial instruments under AASB 132, meaning they have both a liability component (the obligation to repay the principal) and an equity component (the option to convert into shares).

What Is the Appropriate Treatment for Convertible Notes in Accordance