1. Explain the necessary characteristics that a hedging relationship must display to qualify

for hedge accounting in accordance with AASB 92. ‘Corporate social responsibility’ seems to represent different things to different people. What is your understanding of this phrase?

3.Your friend has observed that corporate social responsibility means that companies take

responsibility for costs arising from their activities, such as the pollution of air and

waterways, that had previously been imposed on society. These ‘social costs’ are referred

to as externalities. (a) What is an example of an externality?

(b) If a firm does not take responsibility for externalities arising from its activities, what

policy initiatives might governments consider to internalise these costs?