AASB 1 - First-time Adoption of Australian Accounting Standards - May 2009
Compound financial instrumentsCompound financial instruments
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Compound financial instruments
D18 AASB 132 Financial Instruments: Presentation requires an entity to split a compound financial instrument at inception into separate liability and equity components. If the liability component is no longer outstanding, retrospective application of AASB 132 involves separating two portions of equity. The first portion is in retained earnings and represents the cumulative interest accreted on the liability component. The other portion represents the original equity component. However, in accordance with this Standard, a first-time adopter need not separate these two portions if the liability component is no longer outstanding at the date of transition to Australian Accounting Standards.