Nortel Case - They have great guarantees and commitments....

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The quality of disclosures for guarantees and commitments are ok. They follow the guidelines of FIN, and that is good, because it forces them to pay back a certain amount at a certain time, so therefore it will be guaranteed that it will get paid. So that is one of the best guarantees they have. That also requires them to have a commitment, so therefore they will not be defaulting on payments. They also have guarantees when it comes to shares of escrows, which forces them to identify for losses suffered by counterparties in case of litigations. This is also a good guarantee. Yes they could be improved.
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Unformatted text preview: They have great guarantees and commitments. IT not only helps the company out, but it shows they will guarantee their partners and investors that they will make up for any losses. This is actually a good trait to have, because it makes investors want to come invest in their company. However what I think they could improve on is making the items that they guarantees and the commitments they provide clearer and more detailed in the disclosures. It was a bit hard for me to understand what exactly what was said, because they didnt go into enough detail....
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