The financial statements of Overexposure Co for the year ended 31 December 20X1 are to be approved on 31 March 20X2. Before they are approved, the following events take place. 1 On 14 February 20X2 the directors took the strategic decision to sell their investment in Quebec Co despite the fact that this investment generated material revenues. 2 On 15 March 20X2, a fire occurred in the eastern branch factory which destroyed a material amount of inventory. It is estimated that it will cost $505,000 to repair the significant damage done to the factory. 3 On 17 March 20X2, a customer of Overexposure Co went into liquidation. Overexposure has been advised that it is unlikely to receive payment for any of the outstanding balances owed by the customer at the year end. How should these events reflected in the financial statements at 31 December 20X1? Adjust Disclose Do nothing
A、3 2, 3 1
B、2, 3 1 -
C、3 1, 2 -
D、2 3, 1
A、3 2, 3 1
B、2, 3 1 -
C、3 1, 2 -
D、2 3, 1
【参考答案及解析】
IAS 10 requires the financial statements to be adjusted for events that reflect conditions that existed at the reporting date. Only event 3 is indicative of conditions at the reporting date - ie the recoverability of the receivable balance. Events 1 and 2 are non-adjusting events, however, they are material so they should be disclosed.
IAS 10 requires the financial statements to be adjusted for events that reflect conditions that existed at the reporting date. Only event 3 is indicative of conditions at the reporting date - ie the recoverability of the receivable balance. Events 1 and 2 are non-adjusting events, however, they are material so they should be disclosed.