Would these items be considered extraordinary or not for December 2013?
Gain/loss from sale of subsidiary
Gain/loss in early retirement of debt
I know that there have been changes to this previously so I am not sure if older AF posts are valid for Dec 2013.
If you can please reference 2013 CFAI. For 2014 I heard that schweser doesnt match with CFAI on this so I am not sure if 2013 Schweser notes would be good to study this
Extraordinary (under US GAAP) means “unusual _ and _ infrequent”:
- If you’re in an area that has frequent earthquakes, then earthquake loss is not extraordinary; if you’re in an area where earthquakes are rare, then it probably is.
- Gain/loss from the sale of a subsidiary is generally considered unusual _ or _ infrequent, but not unusual _ and _ infrequent: it’s not an extraordinary item.
- Gain/loss on early retirement of debt may be an extraordinary item if it is unusual and infrequent, but if you do it commonly, then it is not extraordinary.
If they give you items such as 1 and 3 on the exam, they’ll have to give you more information on which to judge them; item 2 is not extraordinary.