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  5. GSY: According to gsy news release gsy owns 1123570 shares of afrm. [goeasy Ltd.]
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Q: According to gsy news release gsy owns 1123570 shares of afrm. At 141 per afrm share thatís 158 million USD
Questions
1- how is that accounted for in the financial statement
2- I assume the forfeiture part means if paybright does not hit targets then gsy forfeits the 468k shares
3- is the market even reflecting this in gsy share price





ii) 655,416 common shares of Affirm, and iii) 468,154 common shares of Affirm held in escrow and subject to forfeiture if certain PayBright revenue milestones are not met

Asked by Leon on October 13, 2021
5i Research Answer:

The Affirm investment is classified as 'Investments' on the GSY balance sheet. Changing values in AFRM would be reflected on the balance sheet but GSY initially purchased a swap on the AFRM shares to hedge away market exposure. This results in the non-contingent portion of GSY shares being settled at $108.87 USD. This is still not a bad result as the contingent value of the equity initially was $21.5 mln. 

Overall, GSY still benefits from some of the moves in AFRM but it is not a pure one-to-one relationship.