I'm begging someone to validate for me that these questions and answers are WRONG that CFAI is giving. Selling receivables to a consolidated SPE would not affect leverage or liabilities to total capital. No way.

I got an explanation for these so all set. Apparently we're supposed to assume if receivables aren't sold the firm would seek debt financing instead hence increased assets and liabilities.

A CFA Level 2 Discussion About CFAI TEXTS, VOLUME 2, PAGE 414, QUESTIONS 16 AND 17

Add A Reply

This topic has 1 reply, 1 voice, and was last updated Sep-181:32 am by googs1484.

Author

Posts
- googs1484
  Participant
  - CFA Level 3
  13 Sep 2018 at 11:35 pm
  Up
  0
  ::
  I’m begging someone to validate for me that these questions and answers are WRONG that CFAI is giving. Selling receivables to a consolidated SPE would not affect leverage or liabilities to total capital. No way.
- googs1484
  Participant
  - CFA Level 3
  15 Sep 2018 at 1:32 am
  Up
  1
  ::
  I got an explanation for these so all set. Apparently we’re supposed to assume if receivables aren’t sold the firm would seek debt financing instead hence increased assets and liabilities.
Author

Posts

Viewing 1 reply thread

You must be logged in to reply to this topic.