Nematrian
/

Discounting [13]

Go to: Summary | Previous | Next   
Bullet points include: Generally arise when long term future cash flows need to be met and resources accumulated to meet them There are different sorts of liabilities, e.g. contractually obliged to honour vs. constructive (in sense that will be honoured in any reasonable going concern type of assessment) vs. discretionary Return seeking assets may provide higher longer term returns E.g. equity risk premium or other “outperformance” premiums Discount rate may then need to include some suitable level of prudence to allow for these risks Also allowances for default risk, taxation, other expenses and illiquidity effects

NAVIGATION LINKS
Contents | Prev | Next | Library

Desktop view | Switch to Mobile