Events after the reporting period - as those events, whether favorable or unfavorable, that occur between the end of reporting period and the date on which the FS are authorized for issue; subsequent events; may require either adjustment or disclosure.
Adjusting Events - provide evidence of conditions that exist at the end of reporting period; after the reporting period
- settlement of a court case
- bankruptcy of a customer
- sale of inventories may give evidence about NRV at reporting date
- determination of the cost of asset purchased or the proceeds from asset sold before the end of reporting period
- determination of profit sharing or bonus payment if the entity has the present obligation at the end of reporting period to make such payment
- discovery of fraud or errors that show the FS were incorrect
Nonadjusting Events - indicative of conditions that arise after the end of reporting period
-business combination
-plan to discontinue an operation
-major purchase and disposal of asset or expropriation of major asset by government
-destruction of a major production plant by fire
-major ordinary share transaction
-commencing restructuring
-abnormally large changes in forex rates
-entering into significant commitments or contigent liabilities
-commencing major litigation
-change in tax rate
Appropriate to adjust FS for all adjusting events that occur prior to the date the FS are authorized for issue
*Financial statements are authorized for issue when the board of directors reviews the FS and authorizes them issue.
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BẠN ĐANG ĐỌC
Accounting
Ngẫu nhiênThis book is filled with accounting lessons specially crafted for accounting students and aspiring accountants. Dive into the world of numbers and financial know-how as I guide you through essential concepts and practical insights. Whether you're ju...
