Which of the following is a typical control for debt obligations?

Question

Quizplus · Accepted Answer

Typically, the board of directors approves all new debt obligations and sets policies for managing the company's overall debt portfolio. This helps ensure that the company's borrowing is aligned with its strategic goals and risk appetite, and that it is being managed in a disciplined and responsible manner. While the CFO and upper managers may be involved in the process of evaluating new debt opportunities and negotiating terms, the ultimate decision-making authority typically rests with the board. Stockholders may also have a role in approving certain types of debt, such as convertible bonds or notes that require shareholder approval, but this would be less common than board approval for traditional debt instruments.

Which of the Following Is a Typical Control for Debt