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Cashable GIC
Posted: 05 Jul 2022, 18:42
by Feryal24
Hi all,
If I have a cashable GIC within 30, 60 or 90 days with a maturity term of 1 year would you consider that part of cash and cash equivalents or Term deposits on the FS?
Thoughts?
Re: Cashable GIC
Posted: 05 Jul 2022, 18:51
by Leo
What GIC stands for?
Re: Cashable GIC
Posted: 05 Jul 2022, 18:53
by Feryal24
Sorry.. Guaranteed Investment Certificate
Re: Cashable GIC
Posted: 05 Jul 2022, 19:15
by Leo
Is it like a tracker or a fund? A financial asset but not sure it's classified as cash equivalent or not.
Re: Cashable GIC
Posted: 05 Jul 2022, 19:38
by Feryal24
It is considered a fund that has zero risk. You are guaranteed your investment plus accrued interest. The thing is you don't have access to the cash let's say for 60 days and can accrue interest until the one-year maturity if the funds have not been withdrawn.
Re: Cashable GIC
Posted: 05 Jul 2022, 19:43
by Marek Muc
If the maturity is 1 year it's a strong indicator that it's an asset held for investment purposes rather than for meeting short term cash commitments (hence not a cash equivalent)
Re: Cashable GIC
Posted: 05 Jul 2022, 19:48
by Feryal24
Thank you. I would agree with your suggestion. Just wanted to get another view. Thank you again!