 Let us see first of all the learning outcomes. Students will learn what are derivatives, the basic things, what are the derivatives are, then how they are recorded in the financial statements and how to mitigate risk involved in derivative transaction. So, these are the three basic objectives to learn. Then the objective is to establish principle for presenting financial instrument such as financial assets, financial liability and equity. Although we have discussed this in the previous sessions also, but here we have to discuss in much more detail what are the financial assets, financial liabilities and equity relating to derivative. The standard should all supply by all entities to all types of financial instruments except 19 and 34 and 27 because these three standards are altogether different. Although there are some like derivatives over there, but we are not talking about that. We have to consider only IS-39, IFRS-9. Now, first of all the definition. A derivative is a financial instrument with all three of the following characteristics. All. Do you remember? If anyone is missing, it is not a derivative. Number one, its value changes in response to the changes of specified interest rate, security price, commodity price, foreign exchange rate, index of price or rates, credit rating and credit index are other variables. There are number of variables which affects of their change. So, if they are cheap on changing, we have to see how we are going to record this transaction when there is change occurs. Number one is the value changes in response to all these things. The number two is it requires no initial net investment. Initially, you do not have to spend any money, but in certain cases, you have to pay a little bit of money, but not in all cases. So, there is no initial investment. When you are taking something, I mean if they are contacting, they are not paying the money. Simply, you are recording, you are signing an agreement. So, money is not involved. Secondly, it is settled at a future date. When you have made an agreement for a future date, which will be settled in the future date, today you are signing, let us say, January 1st and you are signing a contract for three months, then after three months, it will settle. The changes that will occur in the demand because of those things, you have to see how to incorporate those things. I mean this particular derivative. An instrument with a return that is obtained from or derived from another underlying financial instrument. Once again, derivative itself is not a share, it is not a commodity. No, it is simply an agreement. So, against this agreement, they derive something from that agreement. In exchange for this agreement, you will get something. And when you go to buy it, you will obviously have to pay it. But initially, you do not have to pay any payment. Now, look at this example. There are warrants, rights, options, forward air, futures. In fact, in the standard, the first warrants and rights are not discussed, but for the sake of knowledge, I explain to you what warrants are and what rights are first. What are warrants basically? When you issue bonds and you think that there is no market for our bonds in the market and people may not buy them, then what do you do? You attach a warrant with that bond. This will also mean that if you buy our bond, you get these free warrants. And in exchange for these warrants, after a certain date, you will be given a share in exchange for it. And that share can be priced too. It can be shared without price. But you are attaching a sort of sweetener with this bond so that people will get a premium share after buying your bonds. Or you will get a share on cheap prices. So that is warrants. Normally, it is full-fledged accounting, which is not discussed in this standard. Similarly, in the case of earning per share, we had read that when a share is issued to its existing shareholders, it is given as a right share. Right shares are normally issued at a lower market price. And when they are issued at a lower market price, the X-Rite private shares are issued at a lower market price. For a shareholder, he does not have the money to buy the right shares. So if he foregoes the right shares, it will be a loss. Because the X-Rite price is lower than the X-Rite price. So the share price will be lower. So technically, if he is sensible, then these rights can also be sold in the market. There is a different price for rights. And people buy those rights because they get a share on cheap bonds. So these rights are also sold. But again, its market is not in our Pakistan and is not discussed in this standard. But the next three options are forward and future. This is the exchange of the stock exchange. The exchange means that these shares are sold in the Pakistan Stock Exchange. Similarly, they also have an exchange. In London, there is a huge business of options, forward and futures. In our Pakistan, there is a mercantile exchange. But very few people know about it. There is trading there. That is, there is trading of forwards and contracts and options. But very few. One thing to note is that this is a kind of risk. When you deal with derivatives, so you are taking a risk. In this risk, you may have a loss and you may have a loss. But if you go into this market, you should fully know how the markets of options, futures and warrants, etc. How do they work? Until you have full knowledge, you should not be involved in this. Because there can be a lot of benefit and a lot of loss. You are predicting the future. So there is no technique to predict the future that could be 100% true prediction. So obviously, there are chances of loss. So this is the topic of derivatives. In this, there is business. People do it. And there is a lot going on outside. And there are a lot of companies involved in this. But we have to remember that we do not have to go into business. In fact, we just have to understand what are the warrants, what are the rights, what are the options, what is the future, and what are your forwards. So that is what we are going to talk about. Look, contracts to purchase or sell specific quantities or commodities. That is, you should not trade in the share of this. You can trade in commodities as well. Specified number one, you can trade in foreign currency as well. At a specified price, a specified price will be determined in advance. Which price you have to buy and which price the other party has to sell you. This price will be determined first. This is called exercise price. Add the inception of the contract with delivery or settlement to take place at the specified future date, whereas its delivery date has to be specified on the future date. If there is a change in the first period between these two, then they can adjust it with mutual mutual agreement. But normally, this trade is like this. In this, people understand each other that okay, let's forgo and adjust. Let's do it together and end it. This is a possibility. But otherwise, you have signed a date, a price, and a particular date has to be settled. Forward is an agreement between two parties in which one party agrees to buy and the other agrees to sell and assets at a future date. That is, both parties agree that they have a seller and buyer. But they do not have anything right now. Remember, neither do they have anything to sell, nor do they have anything. They just agree that they will buy the plan date at this price. One is a seller and the other is a buyer. And they are individuals. Basically, it can be a company, but they are normally individuals. And there is a problem in this that you can make an agreement. But since this is not as strong as it is legally, and if you force a party to do it, it does not honour its contract. What will happen? Obviously, litigation will be carried out. Because there is no such thing in writing that you will definitely do it. After that, the future is a forward commitment to create it and trade it on the future exchange. In this, you will go through the exchange. That is, you will have to involve a party. That is, there is a seller and a buyer. There is a broker in the company. And this broker is an authorized broker. They both get together and then they finalize the deal. As you can see, options are contracts that give the purchaser the right to buy call option. That means the call option means that you have the right to buy. And on the other hand, there is a put option for the sell. So call option and put option are two types. One is going to sell and the other is going to buy. As a specified quantity of financial instrument, commodity or currency at a specified rate, as a specified price. Again, you have to buy something in the future and sell it. The price will be fixed first. So this is how actually these three or four derivatives are, which we are going to talk about. But numerically, we just have to see the future forward or options. Thank you very much.