CAF-6 · Chapter 1 · Question 14 of 15
Which of the following is a classic example of a non-adjusting event after the reporting period?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) A major decline in the market value of investments occurring after the reporting period.
Explanation
A decline in market value after the reporting period does not relate to conditions that existed at the reporting date, making it a non-adjusting event. The other options provide evidence of conditions that existed at year-end.
More IAS 10, IAS 37 & IFRIC 1 MCQs
- Q1A company's reporting period ends on 31 December 20X5. On 15 February 20X6, before the financial statements are authorized for issue, a…
- Q2Omega Industries causes environmental damage in a country where there is no environmental legislation forcing a cleanup. However, Omega…
- Q3Delta Ltd faces claims from 20 customers for faulty products. The company estimates that each claim will be settled in the range of Rs…
- Q4Sigma Corp provides a warranty for its products. Based on past experience, there is a 60% chance of zero repair costs, a 30% chance of…
- Q5Gamma Ltd is being sued for damages of Rs. 5 million, and a provision is recognized for this full amount. Gamma expects to recover Rs. 3…