Scribd
Upload
683 views8 pages

MFRS 110 Events After The Reporting Period

This document discusses events after the reporting period as defined by MFRS 110. It identifies two types of events - adjusting events that provide evidence of pre-existing conditions, and non-adjusting events that indicate later conditions. Adjusting events require financial statement adjustments while non-adjusting events require disclosure only. Examples of each type are provided, covering areas like bad debts, inventory valuation, court cases, and asset purchases/disposals. Dividends are not recognized as liabilities, and going concern issues may require liquidation-basis statements.

Uploaded by

Siti Aisyah Mokhtar
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
683 views8 pages

MFRS 110 Events After The Reporting Period

This document discusses events after the reporting period as defined by MFRS 110. It identifies two types of events - adjusting events that provide evidence of pre-existing conditions, and non-adjusting events that indicate later conditions. Adjusting events require financial statement adjustments while non-adjusting events require disclosure only. Examples of each type are provided, covering areas like bad debts, inventory valuation, court cases, and asset purchases/disposals. Dividends are not recognized as liabilities, and going concern issues may require liquidation-basis statements.

Uploaded by

Siti Aisyah Mokhtar
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
You are on page 1/ 8

18/10/2021

MFRS 110
EVENTS AFTER THE
REPORTING PERIOD
Good Day Learn from
your mistakes

1
18/10/2021

Definition

MFRS 110 defines events after the reporting date as ‘those events, both
favourable and unfavourable, that occur between the end of the reporting
period and the date when the financial statements are authorised for issue’.

The standard has identified two types of events.


They are:
a. Those events that provide further evidence of conditions that existed
at the end of the reporting period (adjusting events), and
b. Those that are indicative of conditions that arose after the end of the
reporting period (non-adjusting events).

Date When The Financial Statements Are


Authorised For Issue

The date on which the financial statements are


authorised for issue depends on the
management structure, statutory requirements
and procedures followed by each entity in
preparing and finalising the financial
statements.

2
18/10/2021

Adjusting Events
• Adjusting events affect the financial position and performance
measurement of the entity even though they occurred between the
reporting date and the date the financial statements were authorised for
issue.
• The accounting treatment is to adjust the elements of financial
statements affected by these events.
– Measurement of bad and doubtful debts
– Determining the net realisable value of inventory
– Court case
– Impairment of assets
– Cost of assets purchased or proceeds from disposal of assets
– Profit sharing or bonus
– Fraud

Example: measurement of bad and doubtful debts

3
18/10/2021

Example: measurement of bad and doubtful debts

Example: Determining the Net realisable value of inventory

4
18/10/2021

Example: Court case

Example: Profit Sharing or Bonus

10

5
18/10/2021

Non-Adjusting Events

For non-adjusting events, no adjustments are made but


the following disclosure should be provided:
– the nature of the event, and
– the estimate of the financial effect, or a statement
that such an estimate cannot be made.

11

Examples of non-adjusting events:


 Decline in the market value of investments after the
reporting date,
 A major business combination after the reporting date
 Announcing a plan to discontinue an operation,
disposing of assets etc.
 Major purchases and disposals of assets or
expropriation of major assets by government.
 Destruction of a major production plant by a fire after
the balance sheet date.
 Major restructuring

12

6
18/10/2021

Example: No adjusting / Need to disclosure in notes to account

13

Dividends and Going Concern Status

• Dividends
Proposed dividends are not present obligations and are not to
be recognised as liabilities. A disclosure is required.

• Going Concern Status


Where the management determines after the reporting date
that it intends to liquidate the entity or to cease trading, or
that it has no realistic alternative but to do so, then the going
concern assumption used in preparing the financial statements
may no longer be appropriate. Financial statements are to be
prepared on a liquidation basis.

14

7
18/10/2021

Tutorial

15

You might also like

pFad - Phonifier reborn

Pfad - The Proxy pFad of © 2024 Garber Painting. All rights reserved.

Note: This service is not intended for secure transactions such as banking, social media, email, or purchasing. Use at your own risk. We assume no liability whatsoever for broken pages.


Alternative Proxies:

Alternative Proxy

pFad Proxy

pFad v3 Proxy

pFad v4 Proxy