IMMATERIALITY Definition

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IMMATERIALITY is of complete irrelevance requiring no further consideration.

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PLEDGE is a. the transfer or assignment of assets as collateral to secure payment of a debt obligation as when securities are pledged to a lender for a loan secured by the owner of the securities. When securities a pledged, the lender frequently requires the physical transfer of the collateral to preclude possibility of using the same asset for additional pledging; b. the deposit or placing of personal property as security for a debt or other obligation with a person called a pledgee. The pledgee has the implied power to sell the property if the debt is not paid. If the debt is paid, the right to possession returns to the pledgor; or, c. a written or oral agreement to contribute cash or other assets.

ACCUMULATED ADJUSTMENT ACCOUNT (AAA) under Section 1368(e)(1) of the IRS Code provides that the term 'accumulated adjustment account' (AAA) means an account of the S corporation which is adjusted for the S period in a manner similar to the adjustments under 1367 (except that no adjustment shall be made for income (and related expenses) which is exempt from tax under title 26 and the phrase '(but not below)' shall be disregarded in 1367(b)(2)(A)) and no adjustment shall be made for Federal taxes attributable to any taxable year in which the corporation was a C corporation.

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