Before revision:  From these objectives we derive two normative requirements for capital adequacy tests, called surplus and num\'eraire invariance, respectively. We characterize capital adequacy tests that satisfy surplus and num\'eraire invariance, establish an intimate link between these requirements, and highlight an inherent tension between the ability to meet them and the desire to give credit for diversification raire.
After revision:  From these objectives we derive two normative requirements for capital adequacy tests, i.e. tests that do not depend on the surplus of a financial institution. We provide a complete characterization of closed, convex, surplus-invariant capital adequacy tests that satisfy surplus and num\'eraire invariance, establish an intimate link between these requirements, and highlight an inherent tension between the ability to meet them and the desire to give credit for diversification raire.