DD Support Board and Research Team

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Welp, I had to wait for dear spouse to a free moment to answer a hypo to a question I already knew the answer to. It is a soft hit on the financials, but it still affects valuation. Also, the deriv. owner has a tax liability in the year it was issued based on the discounted rate, and then capital gains once sold. The holder wants out as soon as possible with a discounted conversion, so that will eventually suppress the stock price. The deriv. liabilities do have repercussions even though it is a soft hit. Not many CPAs are efficient in deriv. accounting no matter how many years of college and CPE classes, even dear spouse had to think about this one.

Auditors are much more proficient at deriv. accounting than oil patch or tax accountants in strip malls.