ACCA FR · Chapter 8 · Question 8 of 10
Which of the following events, occurring after the reporting date but before the financial statements are authorised for issue, is an ADJUSTING event under IAS 10?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: D) A major customer that owed money at the year end is declared bankrupt
Explanation
Adjusting events give evidence of conditions that existed at the reporting date. A customer's bankruptcy confirms that the receivable was impaired at the year end, so the allowance is adjusted. A fire, a share issue and the declaration of a dividend all reflect conditions that arose after the year end. They are non-adjusting, and are disclosed if material.
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