BUSINESS ADMINISTRATION
FINANCIAL ACCOUNTING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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An event that occurs between the reporting date and the date on which the financial statements are authorised for issue that provides further evidence of conditions that existed at the reporting date
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An event that occurs between the reporting date and the date on which the financial statements are authorised for issue that provides evidence of conditions that arose subsequent to the reporting date
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An event that occurs after the date the financial statements are authorised for issue that provides further evidence of conditions that existed at the reporting date
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An event that occurs after the date the financial statements are authorised for issue that provides evidence of conditions that arose subsequent to the reporting date
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Detailed explanation-1: -Adjusting events are those providing evidence of conditions existing at the end of the reporting period, whereas non-adjusting events are indicative of conditions arising after the reporting period (the latter being disclosed where material).
Detailed explanation-2: -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 financial statements are authorised for issue.
Detailed explanation-3: -Which of the following events after the reporting period would require adjustment in an entity’s financial statements? Bankruptcy of a customer, which occurs after the end of the reporting period and before the issuance of the statements, resulting in the loss of a trade receivable account.
Detailed explanation-4: -Which event after the end of reporting period would generally require disclosure? At the end of the current reporting period, an entity carried a receivable from a major customer who declared bankruptcy after the end of reporting period and before the issuance of financial statements.