AASB 2011-8 - Amendments to Australian Accounting Standards arising from AASB 13 - September 2011
62In Appendix A, paragraph A2 is amended as follows (new text is underlined and deleted text is struck through):
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62 In Appendix A, paragraph A2 is amended as follows (new text is underlined and deleted text is struck through):
A2 The issue of ordinary shares at the time of exercise or conversion of potential ordinary shares does not usually give rise to a bonus element. This is because the potential ordinary shares are usually issued for full fair value, resulting in a proportionate change in the resources available to the entity. In a rights issue, however, the exercise price is often less than the fair value of the shares. … The theoretical ex-rights fair value per share is calculated by adding the aggregate market fair value of the shares immediately before the exercise of the rights to the proceeds from the exercise of the rights, and dividing by the number of shares outstanding after the exercise of the rights. Where the rights are to be publicly traded separately from the shares before the exercise date, fair value for the purposes of this calculation is established measured at the close of the last day on which the shares are traded together with the rights.