IAS 10: Events after the reporting period

Question 1

Events after the reporting period are those events, favourable and unfavourable, that occur between the end of the reporting period and the date when the FSs are authorised for issue

Answer 1

.

Question 2

Adjusting events after the reporting period are..

Answer 2

events that provide evidence of conditions that existed at the end of the reporting period

Question 3

Non-adjusting events after the reporting period are..

Answer 3

events that are indicative of conditions that arose after the reporting period

Question 4

Non adjusting events that are immaterial

Answer 4

do nothing

Question 5

Non-adjusting events that are material

Answer 5

Non-disclosure could influence the economic decisions of users taken on the basis of the FSs

Accordingly the entity shall disclose the following for each material category of non-adjusting event after the reporting period:

• The nature of the event
• An estimate of its financial effect, or a statement that such an estimate cannot be made

Question 6

What about a devastating fire AFTER accounting period?

Answer 6

The fire is after the accounting period so it’s non-adjusting ….. UNLESS its is so bad that the business is no longer a ‘going concern’ … so actually this would affect a condition that existed during the period (the going concern’) and therefore would be an adjusting event… would have to prep accounts on a break-up basis (not in syllabus)