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IAS 10

Events after the Reporting Period

IAS 10 determines when events occurring between the end of the reporting period and the date the financial statements are authorised for issue should change the numbers in the accounts (adjusting events) versus only be described in a note (non-adjusting events), and sets out the going-concern and dividend implications of such events. [S1]

Effective 2005-01-01Related: IAS 1 · IAS 8 · IAS 37

Overview

Events after the reporting period are those, favourable or unfavourable, that occur between the reporting date and the date the financial statements are authorised for issue. [S1] IAS 10 splits them into adjusting events (providing evidence of conditions that existed at the reporting date, so the financial statements are updated) and non-adjusting events (indicative of conditions arising after the reporting date, so the statements are not changed but material ones are disclosed). The standard also fixes the authorisation-for-issue date as the cut-off and requires disclosure of who gave that authorisation and when. [S2]

Why it matters

The window between year-end and the board's sign-off of the financial statements can span weeks or months while audit fieldwork, tax reconciliations and board scheduling are completed. Material developments in that window — a major customer's insolvency, a fire, a court judgment, a fundraising round — change how the market and lenders read the accounts. Getting the adjusting/non-adjusting call wrong either misstates the financial position or omits information a lender or investor would need.

Scope

Applies to all events between the reporting date and the date of authorisation for issue, regardless of whether they are favourable or unfavourable, and regardless of whether they are publicly announced before or after the financial statements are issued. It also addresses two specific items directly: dividends declared after the reporting date, and the appropriateness of the going concern basis when post-year-end events indicate the entity may not continue as a going concern.

Key definitions

term
Events after the reporting period
definition
Events, favourable or unfavourable, occurring between the end of the reporting period and the date the financial statements are authorised for issue.
term
Adjusting event
definition
An event after the reporting period that provides further evidence of conditions that existed at the end of the reporting period.
term
Non-adjusting event
definition
An event after the reporting period that is indicative of a condition that arose after the end of the reporting period.
term
Date of authorisation for issue
definition
The date on which the financial statements would be considered complete and in a form compliant with applicable requirements, and on which those with the recognised authority (typically the board of directors) have approved them for issue.

Recognition

Adjusting events require the entity to update the amounts recognised in the financial statements (or to recognise items not previously recognised) to reflect the new evidence about year-end conditions — for example, a court case that was already ongoing at year-end being settled after year-end confirms (or changes) the year-end provision; a customer that was already in financial difficulty at year-end being declared insolvent shortly afterwards confirms the receivable was impaired at year-end. Non-adjusting events are not recognised in the amounts, but are disclosed if material, together with an estimate of the financial effect or a statement that a reasonable estimate cannot be made.

Initial measurement

There is no separate 'initial measurement' step distinct from recognition here; where an event is adjusting, the year-end asset, liability, income or expense is measured using the information available at the date of authorisation for issue that clarifies what the position actually was at year-end (not what it became afterwards for unrelated reasons).

Subsequent measurement

Not applicable in the ordinary sense; IAS 10 is a cut-off and disclosure standard rather than a recognition-and-measurement standard for an asset class. The relevant ongoing discipline is monitoring the period through to the actual date the board authorises the statements for issue, since that date — not the audit report date or the AGM date — is generally the operative cut-off.

Presentation

Dividends declared to holders of equity instruments after the reporting period are not recognised as a liability at the reporting date, because no obligation exists at that date; they are disclosed in the notes (or on the face of the statement of changes in equity) rather than accrued. If, after the reporting period, management determines it intends to liquidate the entity or cease trading, or that it has no realistic alternative, the financial statements should not be prepared on a going concern basis at all — this is a fundamental change in basis of preparation, not a normal adjusting or non-adjusting note.

Disclosure checklist

  • Date the financial statements were authorised for issue and who gave that authorisation.
  • If the owners or others have the power to amend the financial statements after issue, disclosure of that fact.
  • For each material category of non-adjusting event: its nature and an estimate of its financial effect, or a statement that such an estimate cannot be made.
  • Any update of disclosures about conditions existing at the reporting date, in light of new information received after the reporting date (even where no amount is adjusted).
  • Where the going concern basis is no longer appropriate because of a post-year-end event, disclosure of that fact and the basis actually used to prepare the statements.
  • Dividends proposed or declared after the reporting date but before authorisation for issue, disclosed rather than recognised as a liability.

Practical treatment

Practical scenarios that recur across engagements: (1) a bank covenant breach that existed at year-end (e.g. a debt-service coverage ratio already fallen below the required level at the reporting date) is an adjusting-type condition for classification of the related loan as current versus non-current, even where the lender's formal waiver letter is dated after year-end — the breach existed at year-end; a waiver received after year-end does not retroactively cure the classification unless the waiver itself was agreed and unconditional before the reporting date. (2) A significant customer default confirmed after year-end, where the customer was already known to be struggling at year-end, is an adjusting event affecting the year-end expected credit loss estimate. (3) Macroeconomic developments announced shortly after year-end are normally non-adjusting (conditions arising after year-end), though their scale may still require disclosure of a material financial effect estimate. See nigeria_notes for the specific board-approval and macro-event context.

Common mistakes

  • Accruing a dividend as a liability at year-end because the board's recommendation was well known before sign-off, even though the formal declaration or shareholder approval happened after the reporting date.
  • Treating a loan covenant breach that existed at year-end as non-adjusting simply because the lender's waiver letter arrived before the audit report was signed.
  • Confusing the audit report date, the board approval date and the AGM date, and using the wrong one as the cut-off for identifying subsequent events.
  • Continuing to prepare statements on a going concern basis after a post-year-end decision to cease trading, instead of changing the basis of preparation entirely.
  • Disclosing a non-adjusting event only in the directors' report and omitting the required note disclosure of its nature and estimated financial effect in the financial statements themselves.

CFO checklist

  • Establish and document the actual date of board authorisation for issue, distinct from the audit report date and the AGM date.
  • Run a formal subsequent-events review procedure covering the period from year-end to board sign-off, evidenced in the audit file.
  • For any loan covenant, confirm whether a breach existed at year-end and whether any waiver was agreed and unconditional before the reporting date.
  • Confirm dividends recommended or declared after year-end are disclosed, not accrued as a year-end liability.
  • Assess whether any post-year-end development affects the going concern basis of preparation, not just a disclosure note.
  • Quantify, where possible, the estimated financial effect of each material non-adjusting event for the notes.

FAQs

q
Our board approved the financial statements on 15 March, but the AGM was held on 20 June — which date is the subsequent events cut-off?
a
Generally the board approval date (15 March) is the date of authorisation for issue for IAS 10 purposes, since that is when those with recognised authority approved the statements for issue; events between board approval and the AGM are usually outside the IAS 10 window unless the statements can still be amended before the AGM. [S4]
q
A major customer went into liquidation two months after our year-end — is this adjusting or non-adjusting?
a
It depends on whether the conditions causing the liquidation already existed at year-end. If the customer was already in financial distress at the reporting date, the liquidation is evidence confirming that year-end condition (adjusting). If the customer was solvent at year-end and failed only because of a new, unrelated event afterwards, it is non-adjusting but likely requires disclosure given its materiality.
q
Do we need to recognise a liability for a dividend the board recommends at the same board meeting where it approves the financial statements?
a
No. A dividend is not a liability at the reporting date merely because it is recommended after year-end; it is disclosed, not recognised, since no obligation existed at the reporting date itself.

Nigeria application notes

Regulatory overlay

IFRS Accounting Standards, including IAS 10, apply to Nigerian public interest entities under the FRCN Act 2011 mandate. [S3] Under CAMA 2020, financial statements are approved by the board of directors, with the CEO and CFO required to certify their accuracy under section 405(1), before being laid before the AGM for shareholders' consideration and approval; the board's approval, not the later AGM presentation, is generally the relevant 'authorisation for issue' date for IAS 10 purposes, which is distinct from the later date on which the financial statements are laid before, and considered (not approved) by, shareholders at the AGM. [S4][S5][S6]

Tax interaction (Nigeria)

A change in Nigerian tax law or rate enacted or substantively enacted after year-end but before authorisation for issue (for example the phased effective dates under the Nigeria Tax Act 2025) is typically a non-adjusting event for financial reporting purposes unless it provides evidence of a condition existing at year-end; its estimated financial effect should be disclosed if material. [S_TAX1]

FX considerations

A material naira devaluation, Central Bank of Nigeria policy shift, or fuel/energy price change announced shortly after year-end is normally a non-adjusting event (a condition arising after year-end), since it does not itself provide evidence of conditions existing at the reporting date; however, its scale may still require disclosure of a material estimated financial effect, particularly for entities with material foreign-currency exposures. [S7]

SME practical note

For owner-managed Nigerian companies, the 'board approval' date is sometimes informal or undocumented; Outliers recommends every client maintain a dated, minuted board resolution approving the financial statements for issue, since without it the authorisation-for-issue date — and therefore the subsequent-events cut-off — is difficult to evidence to an auditor or regulator.

Common Nigerian pitfalls

  • No dated, minuted board resolution evidencing the authorisation-for-issue date, leaving the subsequent-events cut-off undocumented.
  • Treating the AGM date, rather than the board approval date, as the relevant IAS 10 cut-off.
  • Assuming a lender's post-year-end waiver retroactively cures a year-end covenant breach for loan classification purposes.
  • Failing to disclose a material post-year-end naira devaluation or policy change with an estimated financial effect, even though no amount is adjusted.

FRC pronouncements

No FRCN pronouncement specific to events-after-the-reporting-period accounting has been identified; FRCN's role here is the general supervisory mandate to promote IFRS compliance. [S3]

Worked examples

Adjusting event — customer insolvency confirming a year-end impairment

At 31 December 2025, a distributor's largest customer owed ₦20,000,000 and was already showing signs of financial distress (late payments, disputed invoices). The customer was placed into liquidation on 20 February 2026, before the financial statements were authorised for issue on 15 March 2026. Only 30% of the balance is expected to be recovered.

Facts

Workings

Receivable balance at year-end: 20,000,000

Expected recovery: 30% x 20,000,000 = 6,000,000

Impairment loss to recognise at year-end (adjusting event): 20,000,000 - 6,000,000 = 14,000,000

Journal entries

Recognise impairment confirmed by post-year-end liquidation of a customer already in distress at year-end.

AccountDr (₦)Cr (₦)
Impairment loss on trade receivables (profit or loss)14,000,000
Allowance for expected credit losses – trade receivables14,000,000

Non-adjusting event — fire loss after year-end

A warehouse not related to any year-end condition was destroyed by fire on 10 February 2026, after the 31 December 2025 year-end, resulting in an estimated ₦35,000,000 loss, partly covered by insurance.

Facts

Workings

No adjustment is made to the 31 December 2025 figures, since the fire is a new event, not evidence of a year-end condition.

Disclosure required: nature of the event and an estimate of its financial effect (gross loss of approximately 35,000,000, subject to insurance recovery assessment).

Sources & citations

  1. [S1]IAS 10 Events after the Reporting Period — IFRS Foundationaccessed 2026-07-18
  2. [S2]IAS 10 — Events After the Reporting Period (standard summary) — IAS Plus, Deloitteaccessed 2026-07-18
  3. [S3]IFRS - Use of IFRS Standards by jurisdiction: Nigeria — IFRS Foundationaccessed 2026-07-18
  4. [S4]Navigating Corporate Decisions in Nigerian Companies Limited by Shares Under CAMA 2020 — The Legal Troveaccessed 2026-07-18
  5. [S5]Highlights of the provisions relating to financial statements, audit and annual returns in CAMA 2020 — Dentons ACAS-Lawaccessed 2026-07-18
  6. [S6]Company Meetings in Nigeria Under CAMA 2020: AGM, Statutory, EGM, and Resolutions Explained — LearningTheLawaccessed 2026-07-18
  7. [S7]Monetary Policy Decisions (exchange rate and monetary policy context) — Central Bank of Nigeriaaccessed 2026-07-18
  8. [S_TAX1]Nigeria Tax Act, 2025 has been signed – highlights — EY Globalaccessed 2026-07-18
Last reviewed 2026-07-18 · Reviewer: Rafiu Olawuyi (FCA — Author / Technical Reviewer)