Preference shares redeemed at premium

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omiakotkina
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Joined: 13 Dec 2021, 23:00

Preference shares redeemed at premium

Post by omiakotkina »

Hi guys. Want to run by you if you think the below entries make sense under IFRS.

Preference shares of 100, classified as equity, has 7% dividend and 4% redemption premium. Matures in 7y.

Initial recognition:
Dr Cash 100
Cr Preference shares (equity) 100

After year 1, dividend is paid and redemption premium starts to accrue:
Dr Preference shares reserve (equity) 7 (100*7%)
Cr Cash 7

Dr Equity 4/7 (100*4%*7y)
Cr Redemption reserve 4/7

What do you think guys?
Thanks
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Marek Muc
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Re: Preference shares redeemed at premium

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JRSB
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Re: Preference shares redeemed at premium

Post by JRSB »

agree
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