05-29-2007, 06:58 PM
Dear,
However, if some investments have to be valued under IAS 39 as available for sale on fair values, then the bonus shares will also be given the fair value and such value will be incorporated in the financial statements just crediting the fair value gain for the period. IAS 39 in this matter overrides the TR-15.
Further, if investments are in associates and have to be stated under equity method (IAS-28), again the bonus shares (just as number of shares) will be considered to calculate the equity held percentage and this way will carry the portion of their post acquisition profits/losses and direct movements in reserves. This is done as the total number of shares issue by such associte changes after issuing the bonus shares and when the investee has to calculate post acquisition share in profits, it has to consider its bonus shares for calculating latest equity held percentage. However, in this case there would be no other impact on valuation.
Best regards,
Kamran.
However, if some investments have to be valued under IAS 39 as available for sale on fair values, then the bonus shares will also be given the fair value and such value will be incorporated in the financial statements just crediting the fair value gain for the period. IAS 39 in this matter overrides the TR-15.
Further, if investments are in associates and have to be stated under equity method (IAS-28), again the bonus shares (just as number of shares) will be considered to calculate the equity held percentage and this way will carry the portion of their post acquisition profits/losses and direct movements in reserves. This is done as the total number of shares issue by such associte changes after issuing the bonus shares and when the investee has to calculate post acquisition share in profits, it has to consider its bonus shares for calculating latest equity held percentage. However, in this case there would be no other impact on valuation.
Best regards,
Kamran.
