Deloitte. IFRS Bookmarks VIEW ADD QuickFind. GO Keyword AS 33 Home> Assessment Q

Question

Deloitte. IFRS Bookmarks VIEW ADD QuickFind. GO Keyword AS 33 Home> Assessment Question 7 When are purchased options and written put options dilutive potential ordinary shares? Select one option and click Submit Message Centre? Purchased options are always anti-dilutive. Written put options are dilutive i they are 'in the money in the money Witten put options are always anti-dilutive. Purchased Tools oPurchased options and witen options are dilutive if they are Background Coach options are dilutive if they are "in the money Purchased options and written put options are always anti dilutive Examples Reference Excel HELPPRINT 8/12

Explanation / Answer

Purchased options are always anti-dilutive. The entity cannot be assumed to exercise as it will act in its own benefit and decreased EPS is not beneficial.

Written put options are dilutive if they are in the money i.e. they are dilutive when the entity has to buy them back at a price that is more than the market price at the time.

Hence, Option-(a) is correct.

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