IAS 10

IAS 10

Events after the Reporting Period

In April 2001 the International Accounting Standards Board (Board) adopted IAS 10 Events
After the Balance Sheet Date, which had originally been issued by the International
Accounting Standards Committee in May 1999. IAS 10 Events After the Balance Sheet
Date replaced parts of IAS 10 Contingencies and Events Occurring After the Balance Sheet
Date (issued in June 1978) that were not replaced by IAS 37 Provisions and Contingent Assets
and Contingent Liabilities (issued in 1998).

In December 2003 the Board issued a revised IAS 10 with a modified title—Events after the
Balance Sheet Date. This revised IAS 10 was part of the Board’s initial agenda of technical
projects. As a result of the changes in terminology made by IAS 1 Presentation of Financial
Statements in 2007, the title of IAS 10 was changed to Events after the Reporting Period.

Other Standards have made minor consequential amendments to IAS 10. They include
IFRS 13 Fair Value Measurement (issued May 2011), IFRS 9 Financial Instruments (issued July
2014) and Definition of Material (Amendments to IAS 1 and IAS 8) (issued October 2018).

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CONTENTS
from paragraph

INTERNATIONAL ACCOUNTING STANDARD 10

EVENTS AFTER THE REPORTING PERIOD
OBJECTIVE 1
SCOPE 2
DEFINITIONS 3
RECOGNITION AND MEASUREMENT 8
Adjusting events after the reporting period 8
Non-adjusting events after the reporting period 10
Dividends 12
GOING CONCERN 14
DISCLOSURE 17
Date of authorisation for issue 17
Updating disclosure about conditions at the end of the reporting period 19
Non-adjusting events after the reporting period 21
EFFECTIVE DATE 23
WITHDRAWAL OF IAS 10 (REVISED 1999) 24
APPENDIX
Amendments to other pronouncements
APPROVAL BY THE BOARD OF IAS 10 ISSUED IN DECEMBER 2003

FOR THE BASIS FOR CONCLUSIONS, SEE PART C OF THIS EDITION

BASIS FOR CONCLUSIONS

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International Accounting Standard 10 Events after the Reporting Period (IAS 10) is set out
in paragraphs 1–24 and the Appendix. All the paragraphs have equal authority but
retain the IASC format of the Standard when it was adopted by the IASB. IAS 10 should
be read in the context of its objective and the Basis for Conclusions, the Preface to IFRS
Standards and the Conceptual Framework for Financial Reporting. IAS 8 Accounting Policies,
Changes in Accounting Estimates and Errors provides a basis for selecting and applying
accounting policies in the absence of explicit guidance. [Refer: IAS 8 paragraphs 10–12]

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International Accounting Standard 10

Events after the Reporting Period

Objective
1 The objective of this Standard is to prescribe:

(a) when an entity should adjust its financial statements for events after
the reporting period; and
[Refer: paragraphs 8 and 9]

(b) the disclosures that an entity should give about the date when the
financial statements were authorised for issue [Refer: paragraphs 4–6, 17
and 18] and about events after the reporting period [Refer: paragraphs
19–22].
[Refer: Conceptual Framework paragraph 3.7]

The Standard also requires that an entity should not prepare its financial
statements on a going concern [Refer: paragraphs 14–16] basis if events after the
reporting period [Refer: paragraph 3 (definition of events after the reporting period)]
indicate that the going concern assumption [Refer: IAS 1 paragraphs 25 and 26] is
not appropriate.

Scope
2 This Standard shall be applied in the accounting for, [Refer: paragraphs 8–16]
and disclosure of, [Refer: paragraphs 17–22] events after the reporting period.

Definitions
3 The following terms are used in this Standard with the meanings specified:

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.E1
[Refer: paragraphs 4–6] Two types of events can be identified:

(a) those that provide evidence of conditions that existed at the end of
the reporting period (adjusting events after the reporting period); and
[Refer: paragraphs 8 and 9]

(b) those that are indicative of conditions that arose after the reporting
period (non-adjusting events after the reporting period).
[Refer: paragraphs 10 and 11]

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E1 [IFRIC® Update, May 2013, Agenda Decision, ‘IAS 10 Events after the Reporting Period—
Reissuing previously issued Financial Statements’
The Interpretations Committee was asked to clarify the accounting implications of
applying IAS 10 Events after the Reporting Period when previously issued financial
statements are reissued in connection with an offering document. The issue arose in
jurisdictions in which securities laws and regulatory practices require an entity to reissue
its previously issued annual financial statements in connection with an offering document,
when the most recently filed interim financial statements reflect matters that are accounted
for retrospectively under the applicable accounting standards. In these jurisdictions,
securities law and regulatory practices do not require or permit the entity, in its reissued
financial statements, to recognise events or transactions that occur between the time the
financial statements were first authorised for issued and the time the financial statements
are reissued, unless the adjustment is required by national regulation; instead security and
regulatory practices require the entity to recognise in its reissued financial statements only
those adjustments that would ordinarily be made to the comparatives in the following year’s
financial statements. These adjustments would include, for example, adjustments for
changes in accounting policy that are applied retrospectively, but would not include
changes in accounting estimates. This approach is called ‘dual dating’. The submitter asked
the Interpretations Committee to clarify whether IAS 10 permits only one date of
authorisation for issue (ie ‘dual dating’ is not permitted) when considered within the context
of reissuing previously issued financial statements in connection with an offering document.
The Interpretations Committee noted that the scope of IAS 10 is the accounting for, and
disclosure of, events after the reporting period and that the objective of this Standard is to
prescribe:
(a) when an entity should adjust its financial statements for events after the reporting
period; and
(b) the disclosures that an entity should give about the date when the financial statements
were authorised for issue and about events after the reporting period.
The Interpretations Committee also noted that financial statements prepared in accordance
with IAS 10 should reflect all adjusting and non-adjusting events up to the date that the
financial statements were authorised for issue.
The Interpretations Committee noted that IAS 10 does not address the presentation of re-
issued financial statements in an offering document when the originally issued financial
statements have not been withdrawn, but the re-issued financial statements are provided
either as supplementary information or a re-presentation of the original financial statements
in an offering document in accordance with regulatory requirements.
On the basis of the above and because the issue arises in multiple jurisdictions, each with
particular securities laws and regulations which may dictate the form for re-presentations of
financial statements, the Interpretations Committee decided not to add this issue to its
agenda.]

4 The process involved in authorising the financial statements for issue will vary
depending upon the management structure, statutory requirements and
procedures followed in preparing and finalising the financial statements.

5 In some cases, an entity is required to submit its financial statements to its

shareholders for approval after the financial statements have been issued. In
such cases, the financial statements are authorised for issue on the date of
issue, not the date when shareholders approve the financial statements.

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Example
The management of an entity completes draft financial statements for the
year to 31 December 20X1 on 28 February 20X2. On 18 March 20X2, the
board of directors reviews the financial statements and authorises them for
issue. The entity announces its profit and selected other financial
information on 19 March 20X2. The financial statements are made available
to shareholders and others on 1 April 20X2. The shareholders approve the
financial statements at their annual meeting on 15 May 20X2 and the
approved financial statements are then filed with a regulatory body on
17 May 20X2.

The financial statements are authorised for issue on 18 March 20X2 (date of board
authorisation for issue).

6 In some cases, the management of an entity is required to issue its financial

statements to a supervisory board (made up solely of non-executives) for
approval. In such cases, the financial statements are authorised for issue when
the management authorises them for issue to the supervisory board.

Example
On 18 March 20X2, the management of an entity authorises financial
statements for issue to its supervisory board. The supervisory board is made
up solely of non-executives and may include representatives of employees
and other outside interests. The supervisory board approves the financial
statements on 26 March 20X2. The financial statements are made available
to shareholders and others on 1 April 20X2. The shareholders approve the
financial statements at their annual meeting on 15 May 20X2 and the
financial statements are then filed with a regulatory body on 17 May 20X2.

The financial statements are authorised for issue on 18 March 20X2 (date of
management authorisation for issue to the supervisory board).

7 Events after the reporting period include all events up to the date when the
financial statements are authorised for issue, even if those events occur after
the public announcement of profit or of other selected financial information.

Recognition and measurement

Adjusting events after the reporting period

8 An entity shall adjust the amounts recognised in its financial statements to
reflect adjusting events after the reporting period. [Refer: paragraph 3(a)]

9 The following are examples of adjusting events after the reporting period
[Refer: paragraph 3(a)] that require an entity to adjust the amounts recognised
in its financial statements, or to recognise items that were not previously
recognised:

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(a) the settlement after the reporting period of a court case that confirms
that the entity had a present obligation [Refer: IAS 37 paragraphs 14–26]
at the end of the reporting period. The entity adjusts any previously
recognised provision related to this court case in accordance
with IAS 37 Provisions, Contingent Liabilities and Contingent Assets or
recognises a new provision. The entity does not merely disclose a
contingent liability because the settlement provides additional
evidence that would be considered in accordance with paragraph 16 of
IAS 37.

(b) the receipt of information after the reporting period indicating that an
asset was impaired at the end of the reporting period, or that the
amount of a previously recognised impairment loss for that asset needs
to be adjusted. For example:

(i) the bankruptcy of a customer that occurs after the reporting

period usually confirms that the customer was credit-impaired
[Refer: IFRS 9 Appendix A] at the end of the reporting period; and

(ii) the sale of inventories after the reporting period may give
evidence about their net realisable value at the end of the
reporting period.

(c) the determination after the reporting period of the cost of assets
purchased, or the proceeds from assets sold, before the end of the
reporting period.

(d) the determination after the reporting period of the amount of

profit-sharing or bonus payments, if the entity had a present legal or
constructive obligation at the end of the reporting period to make such
payments as a result of events before that date (see IAS 19 Employee
Benefits). [Refer: IAS 19 paragraphs 19–24]

(e) the discovery of fraud or errors that show that the financial statements
are incorrect.

Non-adjusting events after the reporting period

10 An entity shall not adjust the amounts recognised in its financial
statements to reflect non-adjusting events after the reporting period.
[Refer: paragraph 3(b)]

11 An example of a non-adjusting event after the reporting period

[Refer: paragraph 3(b)] is a decline in fair value of investments between the end
of the reporting period and the date when the financial statements are
authorised for issue. [Refer: paragraphs 4–6] The decline in fair value does not
normally relate to the condition of the investments at the end of the reporting
period, but reflects circumstances that have arisen subsequently. Therefore,
an entity does not adjust the amounts recognised in its financial statements
for the investments. Similarly, the entity does not update the amounts
disclosed for the investments as at the end of the reporting period, although it
may need to give additional disclosure under paragraph 21.

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Dividends
[Refer: Basis for Conclusions paragraph BC4]

12 If an entity declares dividends to holders of equity instruments (as defined

in IAS 32 Financial Instruments: Presentation [Refer: IAS 32 paragraph 11
(definition of an equity instrument)]) after the reporting period, [Refer: paragraphs
4–6] the entity shall not recognise those dividends as a liability at the end
of the reporting period.

13 If dividends are declared after the reporting period but before the financial
statements are authorised for issue, [Refer: paragraphs 3–7] the dividends are
not recognised as a liability at the end of the reporting period because no
obligation exists at that time. Such dividends are disclosed in the notes in
accordance with IAS 1 Presentation of Financial Statements. [Refer: IAS 1
paragraph 137]
[Refer: IFRIC 17 Basis for Conclusions paragraphs BC18–BC20]

Going concern
14 An entity shall not prepare its financial statements on a going concern
basis [Refer: IAS 1 paragraphs 25 and 26] if management determines after the
reporting period either that it intends to liquidate the entity or to cease
trading, or that it has no realistic alternative but to do so.E2

E2 [IFRIC® Update, June 2021, Agenda Decision, ‘IAS 10 Events after the Reporting Period—
Preparation of Financial Statements when an Entity is No Longer a Going Concern’
The Committee received a request about the accounting applied by an entity that is no
longer a going concern (as described in paragraph 25 of IAS 1 Presentation of Financial
Statements). The request asked whether such an entity:
a. can prepare financial statements for prior periods on a going concern basis if it was a
going concern in those periods and has not previously prepared financial statements for
those periods (Question I); and
b. restates comparative information to reflect the basis of accounting used in preparing the
current period’s financial statements if it had previously issued financial statements for
the comparative period on a going concern basis (Question II).
Question I
Paragraph 25 of IAS 1 requires an entity to prepare financial statements on a going concern
basis ‘unless management either intends to liquidate the entity or to cease trading, or has
no realistic alternative but to do so’. Paragraph 14 of IAS 10 states that ‘an entity shall not
prepare its financial statements on a going concern basis if management determines after
the reporting period either that it intends to liquidate the entity or to cease trading, or that it
has no realistic alternative but to do so’.
Applying paragraph 25 of IAS 1 and paragraph 14 of IAS 10, an entity that is no longer a
going concern cannot prepare financial statements (including those for prior periods that
have not yet been authorised for issue) on a going concern basis.
The Committee therefore concluded that the principles and requirements in IFRS Standards
provide an adequate basis for an entity that is no longer a going concern to determine
whether it prepares its financial statements on a going concern basis.
continued...

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...continued

Question II
Based on its research, the Committee observed no diversity in the application of IFRS
Standards with respect to Question II. Therefore, the Committee has not obtained evidence
that the matter has widespread effect.
For the reasons noted above, the Committee decided not to add a standard-setting project
on these matters to the work plan.]

15 Deterioration in operating results [Refer: IAS 1 Basis for Conclusions paragraphs

BC55 and BC56] and financial position after the reporting period may indicate a
need to consider whether the going concern assumption [Refer: IAS 1
paragraph 25] is still appropriate. If the going concern assumption is no longer
appropriate, the effect is so pervasive that this Standard requires a
fundamental change in the basis of accounting, rather than an adjustment to
the amounts recognised within the original basis of accounting.

16 IAS 1 specifies required disclosures if:

[Refer: IAS 1 paragraph 25]

(a) the financial statements are not prepared on a going concern basis; or

(b) management is aware of material uncertainties related to events or

conditions that may cast significant doubt upon the entity’s ability to
continue as a going concern. The events or conditions requiring
disclosure may arise after the reporting period.

Disclosure

Date of authorisation for issue

17 An entity shall disclose the date when the financial statements were
authorised for issue [Refer: paragraphs 4–6] and who gave that authorisation.
If the entity’s owners or others have the power to amend the financial
statements after issue, the entity shall disclose that fact.

18 It is important for users to know when the financial statements were

authorised for issue [Refer: paragraphs 4–6], because the financial statements
do not reflect events after this date.

Updating disclosure about conditions at the end of the

reporting period
19 If an entity receives information after the reporting period about
conditions that existed at the end of the reporting period, it shall update
disclosures that relate to those conditions, in the light of the new
information.

20 In some cases, an entity needs to update the disclosures in its financial

statements to reflect information received after the reporting period,
[Refer: paragraphs 3–7] even when the information does not affect the amounts
that it recognises in its financial statements. One example of the need to
update disclosures is when evidence becomes available after the reporting

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period about a contingent liability that existed at the end of the reporting
period. In addition to considering whether it should recognise or change a
provision under IAS 37, an entity updates its disclosures [Refer: IAS 37
paragraphs 86–92] about the contingent liability in the light of that evidence.

Non-adjusting events after the reporting period

21
If non-adjusting events after the reporting period [Refer: paragraph 3(b)] are
material, [Refer: IAS 1 paragraphs 29–31] non-disclosure could reasonably be
expected to influence decisions that the primary users of general purpose
financial statements make on the basis of those financial statements, which
provide financial information about a specific reporting entity.
Accordingly, an entity shall disclose the following for each material
category of non-adjusting event after the reporting period:

(a) the nature of the event; and

(b) an estimate of its financial effect, or a statement that such an

estimate cannot be made.

22 The following are examples of non-adjusting events after the reporting period
[Refer: paragraph 3(b)] that would generally result in disclosure:

(a) a major business combination after the reporting period (IFRS 3

Business Combinations requires specific disclosures in such cases
[Refer: IFRS 3 paragraphs 59(b) and B66]) or disposing of a major
subsidiary;

(b) announcing a plan to discontinue an operation;

(c) major purchases of assets, classification of assets as held for sale in

accordance with IFRS 5 Non-current Assets Held for Sale and Discontinued
Operations, [Refer: IFRS 5 paragraphs 6–14] other disposals of assets, or
expropriation of major assets by government;

(d) the destruction of a major production plant by a fire after the

reporting period;

(e) announcing, or commencing the implementation of, a major

restructuring (see IAS 37);
[Refer: IAS 37 paragraphs 70–83]

(f) major ordinary share transactions and potential ordinary share

transactions after the reporting period (IAS 33 Earnings per Share
requires an entity to disclose a description of such transactions, other
than when such transactions involve capitalisation or bonus issues,
share splits or reverse share splits all of which are required to be
adjusted under IAS 33);
[Refer: IAS 33 paragraphs 70(d) and 71]

(g) abnormally large changes after the reporting period in asset prices or
foreign exchange rates;

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(h) changes in tax rates or tax laws enacted or announced after the
reporting period that have a significant effect on current and deferred
tax assets and liabilities (see IAS 12 Income Taxes [Refer: IAS 12
paragraph 5 (definitions)]);

(i) entering into significant commitments or contingent liabilities, for

example, by issuing significant guarantees; and

(j) commencing major litigation arising solely out of events that occurred
after the reporting period.

Effective date
23 An entity shall apply this Standard for annual periods beginning on or after
1 January 2005. Earlier application is encouraged. If an entity applies this
Standard for a period beginning before 1 January 2005, it shall disclose that
fact.

23A IFRS 13 Fair Value Measurement, issued in May 2011, amended paragraph 11. An
entity shall apply that amendment when it applies IFRS 13.

23B IFRS 9 Financial Instruments, as issued in July 2014, amended paragraph 9. An

entity shall apply that amendment when it applies IFRS 9.

23C Definition of Material (Amendments to IAS 1 and IAS 8), issued in October 2018,
amended paragraph 21. An entity shall apply those amendments prospectively
for annual periods beginning on or after 1 January 2020. Earlier application is
permitted. If an entity applies those amendments for an earlier period, it shall
disclose that fact. An entity shall apply those amendments when it applies the
amendments to the definition of material in paragraph 7 of IAS 1 and
paragraphs 5 and 6 of IAS 8.

Withdrawal of IAS 10 (revised 1999)

24 This Standard supersedes IAS 10 Events After the Balance Sheet Date (revised in
1999).

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Appendix
Amendments to other pronouncements

The amendments in this appendix shall be applied for annual periods beginning on or after 1 January
2005. If an entity applies this Standard for an earlier period, these amendments shall be applied for
that earlier period.

*****

The amendments contained in this appendix when this Standard was revised in 2003 have been
incorporated into the relevant IFRSs published in this volume.

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Approval by the Board of IAS 10 issued in December 2003

International Accounting Standard 10 Events after the Balance Sheet Date (as revised in 2003)
was approved for issue by the fourteen members of the International Accounting
Standards Board.

Sir David Tweedie Chairman

Thomas E Jones Vice-Chairman
Mary E Barth
Hans-Georg Bruns
Anthony T Cope
Robert P Garnett
Gilbert Gélard
James J Leisenring
Warren J McGregor
Patricia L O’Malley
Harry K Schmid
John T Smith
Geoffrey Whittington
Tatsumi Yamada

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IASB documents published to accompany

IAS 10

Events after the Reporting Period

The text of the unaccompanied standard, IAS 10, is contained in Part A of this edition. Its
effective date when issued was 1 January 2005. This part presents the following
document:

BASIS FOR CONCLUSIONS

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Basis for Conclusions on

IAS 10 Events after the Reporting Period1

This Basis for Conclusions accompanies, but is not part of, IAS 10.

Introduction
BC1 This Basis for Conclusions summarises the International Accounting
Standards Board’s considerations in reaching its conclusions on revising
IAS 10 Events After the Balance Sheet Date in 2003. Individual Board members
gave greater weight to some factors than to others.

BC2 In July 2001 the Board announced that, as part of its initial agenda of
technical projects, it would undertake a project to improve a number of
Standards, including IAS 10. The project was undertaken in the light of
queries and criticisms raised in relation to the Standards by securities
regulators, professional accountants and other interested parties. The
objectives of the Improvements project were to reduce or eliminate
alternatives, redundancies and conflicts within Standards, to deal with some
convergence issues and to make other improvements. In May 2002 the Board
published its proposals in an Exposure Draft of Improvements to International
Accounting Standards, with a comment deadline of 16 September 2002. The
Board received over 160 comment letters on the Exposure Draft.

BC3 Because the Board’s intention was not to reconsider the fundamental
approach to the accounting for events after the balance sheet date established
by IAS 10, this Basis for Conclusions does not discuss requirements in IAS 10
that the Board has not reconsidered.

Limited clarification
BC4 For this limited clarification of IAS 10 the main change made is in paragraphs
12 and 13 (paragraphs 11 and 12 of the previous version of IAS 10). As revised,
those paragraphs state that if dividends are declared after the balance sheet
date,2 an entity shall not recognise those dividends as a liability at the balance
sheet date. This is because undeclared dividends do not meet the criteria of a
present obligation in IAS 37 Provisions, Contingent Liabilities and Contingent Assets.
The Board discussed whether or not an entity’s past practice of paying
dividends could be considered a constructive obligation. The Board concluded
that such practices do not give rise to a liability to pay dividends.3

1 In September 2007 the IASB amended the title of IAS 10 from Events after the Balance Sheet Date to
Events after the Reporting Period as a consequence of the amendments in IAS 1 Presentation of
Financial Statements (as revised in 2007).
2 IAS 1 Presentation of Financial Statements (as revised in 2007) replaced the term ‘balance sheet date’
with ‘end of the reporting period’.
3 In 2007 the Board was advised that paragraph 13, taken in isolation, could be read to imply that a
liability should be recognised in some circumstances on the basis that a constructive obligation
exists, such as when there is an established pattern of paying a dividend. Therefore, the Board
amended paragraph 13 by Improvements to IFRSs issued in May 2008 to state that no such
obligation exists.

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