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Redeemable Preferred Shares - PEAC

Date recorded:

At its meeting on February 2, 2017, the PEAC discussed the results of field testing conducted to assess the viability of permitting a classification exception on the condition of retention of control of an enterprise. In particular, the Committee discussed: (i) whether the current guidance in Section 1591, Subsidiaries, is sufficiently robust to address the characteristics of redeemable preferred shares issued in a tax planning arrangement; (ii) the perspective from which control of the enterprise should be considered; and (iii) other conditions that are necessary, in addition to retention of control over the enterprise. Committee members provided feedback on the types of arrangements that would not meet the classification exception and the potential effect on practice. Committee members also provided input on the overall project timeline.

Review the meeting notes on the AcSB's Web site.

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