NACVA Exam CVA Topic 6 Question 64 Discussion

Actual exam question for NACVA's CVA exam

Question #: 64
Topic #: 6

[All CVA Questions]

Which of the following is NOT out of the characteristics that must be present in a transaction while valuing recapitalizations and senior equity interests under Section 2701?

AThe retained security must be a class senior to the transferred junior security

BThe subject securities (both the retained senior preferred and transferred junior securities) must be non-publicly traded

CThe transaction must result in a transfer (directly or indirectly) between members of the family

DThe transfer is a proportionate transfer of all senior and junior equity interests and, as mentioned the transferor must retain a senior equity interest.

Show Suggested Answer

Suggested Answer: D

by Jaclyn at Feb 04, 2023, 11:24 PM

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Linn

24 days ago

Wait, what's a 'recapitalization' again? Is that when you get your tires rotated and balanced?

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Vivan

4 days ago

C) The transaction must result in a transfer (directly or indirectly) between members of the family

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Adelle

8 days ago

B) The subject securities (both the retained senior preferred and transferred junior securities) must be non-publicly traded

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Sheridan

12 days ago

A) The retained security must be a class senior to the transferred junior security

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Jerilyn

27 days ago

I should've known D was the wrong answer. It's way too detailed to be the 'not out of the characteristics' option. Good thing I double-checked!

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Marta

12 days ago

User 1: I chose D too, but it's not the right answer.

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Donte

1 months ago

Aha! Option B is the one that's not a characteristic. Non-publicly traded securities? That's gotta be it.

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Carlota

14 days ago

C) The transaction must result in a transfer (directly or indirectly) between members of the family

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Louisa

15 days ago

B) The subject securities (both the retained senior preferred and transferred junior securities) must be non-publicly traded

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Destiny

18 days ago

A) The retained security must be a class senior to the transferred junior security

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Helga

2 months ago

Hmm, I'm not sure about this one. The wording is a bit confusing. Let me think this through again...

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Jina

1 months ago

B) The subject securities (both the retained senior preferred and transferred junior securities) must be non-publicly traded

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Lai

1 months ago

A) The retained security must be a class senior to the transferred junior security

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Jenifer

2 months ago

Hmm, that makes sense too. Let's discuss further to figure out the correct answer.

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Celestina

2 months ago

Option D seems a bit too specific to be the correct answer. I'm going with A - the retained security must be a class senior to the transferred junior security.

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Eleonore

3 months ago

I disagree, I believe the answer is A) The retained security must be a class senior to the transferred junior security.

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Jenifer

3 months ago

I think the answer is C) The transaction must result in a transfer between members of the family.

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