Events after the Reporting Period (as per Ind AS 10) Scope, Definitions, Types of Events, Disclosure require as per Ind AS 10

10/02/2024 0 By indiafreenotes

Ind AS 10, “Events after the Reporting Period,” provides guidance on the treatment and disclosure of events that occur between the reporting period end and the date the financial statements are authorized for issue. Understanding its scope, definitions, types of events, and required disclosures is crucial for ensuring financial statements accurately reflect the entity’s position and performance.

Ind AS 10 ensures that financial statements reflect events that occur after the reporting period and that are relevant to the understanding of the financial position and performance of the entity. Adjusting events require adjustments to the financial statements, whereas non-adjusting events may necessitate disclosures to inform users about significant events that could impact their understanding and assessment of the financial statements. By adhering to these requirements, entities enhance the transparency and reliability of their financial reporting, thereby aiding stakeholders in making informed decisions.


Ind AS 10 applies to all recognized and unrecognised events that occur between the end of the reporting period and the date when the financial statements are authorized for issue. It impacts the adjustments to the amounts recognized in financial statements and the disclosures related to those events.


  • Events after the Reporting Period:

Events, both favourable and unfavourable, that occur between the end of the reporting period and the date the financial statements are authorized for issue.

  • Adjusting Events:

Events that provide evidence of conditions that existed at the end of the reporting period.

  • Non-adjusting Events:

Events that indicate conditions that arose after the reporting period.

Types of Events

Adjusting Events:

  • Settlement of a court case that confirms the entity had a present obligation at the end of the reporting period.
  • Receipt of information about the impairment of an asset.
  • Bankruptcy of a customer that occurs after the reporting period but confirms that the customer was in serious financial difficulty at the end of the reporting period.

Non-adjusting Events:

  • Dividends declared after the reporting period.
  • Natural disasters that occurred after the reporting period.
  • Major purchases of assets or disposals of assets, business combinations, or disinvestments.

Disclosure Requirements

For All Events after the Reporting Period:

  1. Date of Authorization:

Disclose the date on which the financial statements were authorized for issue and who gave that authorization. If the entity’s owners or others have the power to amend the financial statements after issuance, that fact should be disclosed.

For Adjusting Events:

  1. Nature and Effect:

Adjust the financial statements to reflect the adjusting events. Although specific disclosures for each adjusting event are not mandated by Ind AS 10, the nature of the adjustment and its financial effect, if material, should be disclosed as part of the relevant notes for the affected financial statement items.

For Non-adjusting Events:

  1. Nature of the Event and Estimate of its Financial Effect:

If non-adjusting events are of such importance that non-disclosure would affect the ability of the users of financial statements to make proper evaluations and decisions, the following should be disclosed:

  • The nature of the event.
  • An estimate of its financial effect, or a statement that such an estimate cannot be made.

Examples of Disclosures for Non-adjusting Events:

  • If a dividend is declared after the reporting period, the entity discloses the dividend declared but not recognized as a distribution to equity holders.
  • In the case of a major business combination after the reporting period, disclose its nature and, if possible, an estimate of its financial effect.
  • For a significant natural disaster, disclose the nature of the event, its financial effect (if estimable), and any possible impacts on the entity’s operations.

Considerations for Preparing Disclosures:

When preparing disclosures for events after the reporting period, entities should consider the relevance and necessity of the information to the users of the financial statements. The goal is to provide clarity about the entity’s financial position and performance, taking into account significant events that occurred after the reporting period. Disclosures should be made in a manner that is understandable, relevant, reliable, and comparable.