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Richard, Tax Attorney
Category: Finance
Satisfied Customers: 55318
Experience:  29 years of experience as a tax, real estate, and business attorney.
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What does "genuine" exactly mean when it is mentioned in a

Customer Question

What does "genuine" exactly mean when it is mentioned in a sentence "If the terms affecting exercisability of put option is genuine, put options shall be recognized."
Submitted: 6 months ago.
Category: Finance
Customer: replied 6 months ago.
The sentence is the quote from the IFRS interpretations.
Expert:  Richard replied 6 months ago.

Hi! My name is Richard & I will be helping you today! It will take me a few minutes to type a response to your question. Thanks for your patience!

Expert:  Richard replied 6 months ago.

"Genuine under the IFRS guidelines regarding genuine means that the terms have "real economic purpose or consequence" and are not inserted into financial instruments solely for some legal or tax reason without a real economic purpose. They would not be "genuine" if the terms are only applicable in the event that is extremely rare, highly abnormal, and/or very unlikely to occur. It's not a black and white situation; rather it's facts and circumstances based. It's very much like the famous Supreme Court justice's definition of "pornography"...I may not be able define it, but I know it when I see it."

Expert:  Richard replied 6 months ago.

Thank you so much for allowing me to help you with your question. I have done my best to provide information which fully addresses your question. If you have any follow up questions, please ask! If I have fully answered your question(s) to your satisfaction, I would appreciate you rating my service as Good or Excellent (i.e., 4 or 5 stars)(hopefully Excellent/5 stars J). Otherwise, I receive no credit for assisting you today. I thank you in advance for taking the time to provide me a positive rating!