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What Are International Accounting Standards (IAS) ?: IAS 10-Events After The Reporting Period
What Are International Accounting Standards (IAS) ?: IAS 10-Events After The Reporting Period
What Are International Accounting Standards (IAS) ?: IAS 10-Events After The Reporting Period
(IAS) ?
International Accounting Standards (IAS) are older accounting standards issued by
the International Accounting Standards Board (IASB), an independent
international standard-setting body based in London. The IAS were replaced in001
by International Financial Reporting Standards (IFRS).
International accounting is a subset of accounting that considers international
accounting standards when balancing books.
IAS 10 Events After The Reporting Period contains requirements for when events
after the end of the reporting period should be adjusted in the financial
statements. 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).
July 1977
Exposure Draft E10 Contingencies and Events Occurring After the Balance
Sheet Date
October 1978 v IAS 10 Contingencies and Events Occurring After the Balance Sheet Date
effective 1 January 1980
August 1997 Exposure Draft E59 Provisions, Contingent Liabilities and Contingent Assets
1 July 1999 Effective date of IAS 37, which superseded those portions of IAS 10 (1978)
dealing with contingencies
November 1998 Exposure Draft E63 Events After the Balance Sheet Date
May 1999 IAS 10 (1999) Events After the Balance Sheet Date superseded those
portions of IAS 10 (1978) dealing with events after the balance sheet date
Objective of IAS 10
•when an entity shall adjust its financial statements for events after reporting
period; and
•the disclosures that an entity shall give about the date when the financial
statements were authorized for issue and about events after the reporting period.
The standard also requires that an entity shall not prepare its financial statements
on a going-concern basis if events after the reporting period indicate that the
going-concern assumption is not appropriate.
Main rules of IAS 10
Event after the reporting period is favorable or unfavorable event that occurs
between :
1. Adjusting events
2. Non-adjusting events.
Adjusting events.
Adjusting event is the event that arose after the end of the reporting period, but
provides further evidence of conditions that existed at the end of the reporting
period.
Going concern: If a management indicates after the end of the reporting period
that it intends to liquidate the business or cease trading or there is no other
realistic alternative, then the financial statements should NOT be prepared under
going concern basis.
Non-adjusting event
Non-adjusting event is an event after the reporting period that indicates
conditions arising after the end of the reporting period.
If dividends are declared after the end of the Reporting Period, but before the
financial statements are approved for issue, the dividends are disclosed in the
notes to the financial statements.
On 10 January 20X2 there is a big fire in the client’s premises and as a result, the
client is not able to pay the full amount to DEF and DEF will suffer a loss of 50%.
This is a non-adjusting event, because the credit loss arose as a result of fire
occurring after the end of the reporting period. DEF needs to make
appropriate disclosures in its financial statements.
Handelsgesetzbuch (HGB)
Handelsgesetzbuch vs. IFRS
2- https://www.ifrsbox.com/ifrs/ias-10/
3- https://www.iasplus.com/en/standards/ias/ias10
July 1977 Exposure Draft E10 Contingencies and Events Occurring After the Balance Sheet Date October 1978 IAS 10 Contingencies and Events Occurring After the Balance Sheet Date effective 1 January 1980 1994 IAS 10 (1978) was reformatted August 1997 Exposure Draft E59 Provisions, Contingent Liabilities and Contingent Assets September 1998 IAS 37 Provisions, Contingent Liabilities and Contingent Assets 1 July 1999 Effective date of IAS 37, which superseded those portions of IAS 10 (1978) dealing with contingencies November 1998 Exposure Draft E63 Events After the Balance Sheet Date May 1999 IAS 10 (1999) Events After the Balance Sheet Date superseded those portions of IAS 10 (1978) dealing with events after the balance sheet date 1 January 2000 Effective date of IAS 10 (1999) 18 December 2003 Revised version of IAS 10 issued by the IASB 1 January 2005 Effective date of IAS 10 (Revised 2003) 6 September 2007 Retitled Events after the Reporting Period as a consequential amendment resulting from revisions to IAS 1
July 1977