Under IFRS preferred shares are classified as a liability rather than as shareholders' equity under certain conditions.What are the implications:

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Classifying preferred shares as a liability would affect financial ratios that utilize shareholders' equity and total liability. This is because preferred shares are considered a form of debt, and including them under liabilities would increase the total liability amount and decrease shareholders' equity. This could impact metrics such as debt-to-equity ratio and return on equity.

Under IFRS Preferred Shares Are Classified as a Liability Rather