Redeemable Preferred Shares – AcSB

Date recorded:

At its meeting on May 15, 2018, the AcSB continued discussing feedback from stakeholders and the recommendations from its PEAC on its Exposure Draft. The Board decided:

  1. to provide an option to present the effect of liability classification of retractable or mandatorily redeemable shares in either retained earnings or a separate component of equity;
  2. no additional transitional relief is necessary for the application of substantive rights guidance;
  3. additional guidance on determining the related party unit of account is necessary and provided feedback on an initial draft of the guidance;
  4. to provide guidance on assessing whether a tax planning arrangement undertaken in a series of steps should be viewed as one tax planning arrangement; and
  5. to clarify whether the decision tree in Financial Instruments, paragraph 3856.A29 also applies to retractable or mandatorily redeemable shares issued in a tax planning arrangement. The Board will issue final amendments no later than the fourth quarter of 2018 in conjunction with the narrow-scoped amendments to Section 3856.

Review the Executive Summary on the AcSB's Web site.

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