ACCA Applied Knowledge · Financial Accounting · Disclosure notes
Which of the following must be disclosed in the notes for a material non-adjusting event after the reporting date under IAS 10?
For a material non-adjusting event, the notes must describe its nature and give an estimate of its financial effect, or state that no estimate can be made. The amounts in the financial statements are not changed, but users need the information.
- AThe nature of the event and an estimate of its financial effect, or a statement that no estimate can be madeCorrect
- BOnly the date on which the event occurred
- CThe journal entries needed to reflect the event in the next period
- DNothing, because non-adjusting events are ignored until the next period
Explanation
IAS 10 requires disclosure of the nature of a material non-adjusting event and an estimate of its financial effect, or a statement that such an estimate cannot be made. Ignoring it would mislead users, and journal entries are not disclosed.
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