CFM25050 - Accounting for corporate finance: hybrid debt: closely related embedded derivatives under IAS 39
This guidance applies to companies which adopt IAS 39 (or FRS 26 under Old UK GAAP).
바카라 사이트楥losely related바카라 사이트�
There is no definition given of 바카라 사이트榗losely related바카라 사이트� in the standard. Instead, both the application guidance and implementation guidance to IAS 39 give examples of what are closely related embedded derivatives (which do not need separating) and those that are not.
For example, where a company holds a convertible bond, the embedded equity option is not closely related to the 바카라 사이트渉ost바카라 사이트� debt contract - the value of the former will change in response to the value of the issuing company바카라 사이트檚 shares, while the value of the latter will be dependent on interest rates.
CFM25060 gives examples of embedded derivatives that are closely related to the host contract, and which therefore do not need to be separated. CFM25070 gives some examples of derivatives that are not closely related, and which therefore would be separated.