If an event or transaction that occurs after reporting date does not relate to conditions that existed at reporting date then:
A) No action should be taken to report the event or transaction in the financial reports.
B) The balance sheet should not be adjusted but effects on the income statement should be reflected in that statement.
C) The event or transaction should be disclosed in the notes to the accounts as a post-reporting date event and the financial statements adjusted appropriately.
D) The event or transaction should be disclosed in the notes to the accounts if it is material.
E) None of the given answers.

Question

Quizplus · Accepted Answer

Post-reporting date events or transactions that are not related to conditions existing at the reporting date should be disclosed in the notes to the accounts if they are material. The financial statements should only be adjusted if the events or transactions provide evidence of conditions that existed at the reporting date.

If an Event or Transaction That Occurs After Reporting Date