Day 2 Flashcards
1
Q
Level 1 of Fair Value Hierarchy
A
A quoted price in an active market for an identical asset or liability
2
Q
Level 2 of Fair Value Hierarchy
A
Replicate market price using observable inputs
* no unobservable inputs
3
Q
Level 3 of Fair Value Hierarchy
A
Replicate market price using observable inputs and unobservable inputs
4
Q
Errors
A
A priori errors are re-stated with the correct number (ie no fabricated numbers issued to balance the books)
5
Q
Financial Instrument
A
Contract creating financial assets for one entity and a financial liability or equity instrument for another entity
6
Q
Financial Asset
A
- Cash, equity of another entity
- Contractual right to exchange financial assets or liabilities favourably
7
Q
Financial Liability
A
- Contractual obligation to deliver a financial asset
- Contractual obligation to exchange a financial asset or liability unfavourably
