Part A

The entity applies MFRS 9 Financial Instruments in accounting for long-term interests

(Loan). The entity applies MFRS 128 Investments in Associates to its net investment in the

associate, which includes long-term interests. When an entity invests in an Associate both

in ordinary shares, preference shares and long term loan, issues arises in treatment of

investments.

Briefly illustrate the concern of stakeholders in applying MFRS 128 and MFRS 9. 5 marks