Which of the following is not an example of a mitigating factor that reduces the risk that the going concern assumption may be in doubt? a. The ability to raise additional funds via borrowings b. A letter of guarantee from a parent company c. The ability to sell an unprofitable segment of the business d. Significant rapid increase in competition

The term Capital forbearance refers to: a. Capital injected by the shareholders of a FI for expansion. b. Freezing of the undistributed capital of an FI by the regulators. c. Regulators’ policy of allowing an FI to continue operating even when its capital funds are fully depleted. d. Mandatory actions that have to be taken by regulators as a DI’s capital ratio falls

Seeking to maximise the current year’s profit is not a sensible objective for most businesses for several reasons. Which is the only one of the following that is not such a reason? Group of answer choices It can be achieved by increasing the number of shareholders. It ignores wealth generation. It ignores risk. It ignores longer term profitability.

What types of firms would we expect to observe higher direct agency costs of equity, such as consuming excessive perquisites by management ?   Question 7 options:   a)  Firms with high free cash flows   b)  Firms with fewer growth opportunities   c)  Firms with weak governance structures   d)  All of the above options are correct   e)  None of the options are correct