Under IAS 10 (Events after the Reporting Period), adjusting events that occur after the balance sheet date are:
A)recognized through adjustment of the financial statements.
B)disclosed in a footnote only.
C)treated as a prior period adjustment.
D)not disclosed, since they occurred after the fact.

Question

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Under IAS 10, adjusting events that occur after the balance sheet date are recognized through adjustment of the financial statements. This is because they provide additional information about the current financial position and performance of the entity and therefore need to be recognized in the period to which they relate. They are not treated as prior period adjustments, and disclosure in footnotes is not sufficient. Not disclosing such events would be a breach of the principle of fair presentation.

Under IAS 10 (Events After the Reporting Period), Adjusting Events