An example of a Type II Subsequent Event includes an earthquake that happens after balance sheet date and destroys a major warehouse of the client.

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A Type II Subsequent Event is an event that provides evidence about conditions that did not exist at the balance sheet date but arose subsequent to that date, and if known at the balance sheet date, would have resulted in adjustment to the financial statements. An earthquake that destroys a major warehouse after the balance sheet date is an example of a Type II Subsequent Event as it occurred after the balance sheet date but had an impact on the financial statements.

An Example of a Type II Subsequent Event Includes an Earthquake