Exercise 7.4 CATEGORISING COMMON FINANCIAL INSTRUMENTS UNDER IAS 32 Categorise each of the following common fi nancial instruments as fi nancial assets, fi nancial liabilities or equity instruments — of the issuer or the holder, as specifi ed.

(a) Loans receivable (holder)

(b) Loans payable (issuer)

(c) Ordinary shares of the issuer

(d) The holder’s investment in the ordinary shares in part

(c)

(e) Redeemable preference shares of the issuer, redeemable at any time at the option of the holder

(f) The holder’s investment in the preference shares in part (e)