CIMAPRA19-F03-1 Exam - Topic 2 Question 15 Discussion

Actual exam question for CIMA's CIMAPRA19-F03-1 exam

Question #: 15
Topic #: 2

A company's Board of Directors is consideringraisinga long-term bank loan incorporatinga number of covenants.

TheBoard members are unsure what loan covenants involve.

WhichTHREEof the following statementsregardingloan covenants are true?

AA positive loan covenant would require the company to undertake specific actions.

BA loan covenant has no contractually binding obligations.

CA restrictive covenant prohibits the company from conducting certain actions without the approval of the lending institution.

DA covenant gives the financial institution the right but not the obligation to convert debt into equity in a case of non-compliance.

EA financial covenant usually requires the company to adhere to specific financial conditions or targets.

Show Suggested Answer

Suggested Answer: A, C, E

by Delisa at May 05, 2022, 06:02 PM

Limited Time Offer

25%

5 months ago

A positive loan covenant requires specific actions.

upvoted 0 times

...

Okay, I think I've got this. The capital requirement is determined by applying risk factors to the insurer's on and off-balance sheet assets and liabilities, and then adding up the results. It's a way of quantifying the overall risk the insurer is exposed to.

upvoted 0 times

...

Dianne

5 months ago

Okay, let me think this through. Since the user is on VLAN 41 and can't get an IP address, I'm guessing we need to enable DHCP snooping on that specific VLAN. Option C seems like the right choice.

upvoted 0 times

...

Paris

5 months ago

This looks like a straightforward relational algebra question. I'll carefully review the tables and think through the different operations to determine which one would yield the desired result.

upvoted 0 times

...

CIMAPRA19-F03-1 Exam - Topic 2 Question 15 Discussion

Contribute your Thoughts:

Hyman

Roosevelt

Arthur

Annamae

Jacqueline

Elroy

Dianne

Paris