INTM577000 - Thin capitalisation: interest cover - debt servicing
Contents
What interest cover means |
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What is interest? |
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Discounted debt and convertible debt |
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What is the correct interest rate? |
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LIBOR - the London Interbank Offered Rate |
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What is the correct measure of income? |
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Earnings Before Interest and Tax - EBIT |
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Earnings Before Interest, Tax, Depreciation and Amortisation - EBITDA |
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The effect of depreciation |
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The effect of amortisation |
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Exceptional items and unforeseen events |
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The effect of accounting standards |
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Other measures of interest cover: netting |
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What is an acceptable arm’s length standard? |
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Example of calculating income for an interest cover calculation |
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Cash flow and cash flow covenants |
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Tests of cashflow sufficiency to pay interest and repay capital |
