Financial instruments Business & Marketing Essay Paper (Essay Sample)

Financial Instruments
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I would advocate that the issuers should account for an instrument with both liability and equity characteristics entirely as a liability or entirely as an equity instrument depending on which characteristic governs. This is based on the different reasoning considering the current situation where FASB assumes that these securities should be considered as liabilities. In the first instance assuming am a shareholder of the company I would recommend that the convertible bonds are converted into equities so that I am able to earn more income through the provision of dividends (Acharya& Ryan, 2016).
As a part of being management team I will support the idea of converting the convertible bonds to liabilities. This would be vital as it will reduce the wealth of the shareholders which will be important in expanding the business. This is also countered by the fact that the management aims to increase the wealth of their shareholders well as the same time be able to expand the scope of their business without seeking additional funding.