This free, guided checker walks your finance team through the key decision points for IAS 10 Non-Adjusting Events Disclosure. Answer a few questions to see the likely treatment and the evidence to document.
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This tool is a high-level IFRS screening aid for general information only and is not accounting, audit or legal advice. Conclusions require entity-specific evidence and judgement - confirm the treatment with your advisor.
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IAS 10.3 defines events after the reporting period as those occurring between the end of the reporting period and the date the financial statements are authorised for issue, whether favourable or unfavourable. Identify the population from board minutes, management enquiries, and significant post-period transactions, and fix the authorisation date because it sets the cut-off (IAS 10.17). The common trap is extending the review beyond the authorisation date or missing events that occur just before it.
No event arose between period end and authorisation, so no IAS 10 assessment or disclosure is required (IAS 10.3).
Official guidance: IFRS issued standards
The distinction turns on IAS 10.3: an adjusting event provides evidence of conditions that existed at the reporting date (IAS 10.8-9), while a non-adjusting event reflects conditions that arose after it (IAS 10.10-11). Test whether the underlying condition (for example a customer's insolvency or a court judgment) existed at period end or emerged afterwards. The common trap is treating a post-period settlement of a pre-existing dispute as non-adjusting when it actually confirms a period-end condition.
The event evidences conditions existing at period end; adjust the recognised amounts as an adjusting event (IAS 10.8).
Official guidance: IFRS issued standards
IAS 10.21 requires disclosure of material non-adjusting events; materiality is assessed against whether omission or misstatement could influence users' economic decisions (IAS 1.7). Weigh both the quantitative effect and qualitative factors such as covenant, regulatory, or related-party dimensions. The common trap is applying a purely numerical threshold and overlooking events that are qualitatively material despite a small immediate figure.
Document the immateriality assessment; IAS 10.21 disclosure is not required for immaterial non-adjusting events (IAS 10.21; IAS 1.7).
Official guidance: IFRS issued standards
IAS 10.22 lists non-adjusting events that would generally result in disclosure, including major business combinations, plans to discontinue operations, destruction of major assets, major restructurings, major share transactions, and significant litigation arising from post-period events; dividends (IAS 10.12) and going concern (IAS 10.14) follow specific rules. Classify the event to the closest category to drive the right disclosure and any related-standard interaction (for example IFRS 3 or IAS 37). The common trap is forcing every event into a generic bucket and missing the interaction with another standard.
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Official guidance: IFRS issued standards
IAS 10.21(a) requires the entity to disclose the nature of each material non-adjusting event. Draft the description from the underlying agreement, board resolution, or announcement so users understand what happened and when. The common trap is a vague description that omits the timing or the counterparties, leaving users unable to assess the event.
Disclose the nature of the material non-adjusting event before authorising the financial statements (IAS 10.21(a)).
Official guidance: IFRS issued standards
IAS 10.21(b) requires either an estimate of the financial effect or a statement that such an estimate cannot be made. Determine whether reliable data exists to quantify the effect on assets, liabilities, income, or cash flows. The common trap is defaulting to a cannot-be-estimated statement when a reasonable estimate is in fact available from the transaction terms.
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Official guidance: IFRS issued standards
Quantify the effect where estimable, for example acquisition consideration for a business combination or an insurance recovery net of the asset loss for a casualty, and present it in the events note (IAS 10.21(b)). Tie the figure to the supporting agreement or valuation. The common trap is disclosing the nature of the event but omitting the available estimate of its financial effect.
Quantify the estimated financial effect, or state that it cannot be estimated, per IAS 10.21(b).
Official guidance: IFRS issued standards
When the financial effect cannot be reliably estimated at the authorisation date, IAS 10.21(b) still requires the nature disclosure plus an explicit statement that an estimate cannot be made. Document the reason quantification is not possible (for example an unresolved valuation or contingent outcome). The common trap is silence - omitting the event entirely rather than disclosing its nature with a no-estimate statement.
Add the explicit statement that the financial effect cannot be estimated to the disclosure (IAS 10.21(b)).
Official guidance: IFRS issued standards
IAS 10 does not require pro forma statements, but supplemental pro forma information (for example a pro forma balance sheet reflecting a post-period business combination or disposal) can help users assess the effect, and regulators may expect it for significant transactions. Decide based on the significance of the event and the needs of users. The common trap is presenting pro forma information without clearly labelling it as supplemental and non-adjusting.
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Official guidance: IFRS issued standards
IAS 10.12 (with IAS 1.137) requires dividends declared after the reporting period to be disclosed and not recognised as a liability at the reporting date, because no present obligation exists until declaration (IAS 10.13). Check the declaration date against the reporting date and reverse any premature accrual. The common trap is accruing a proposed dividend as a period-end liability.
Reverse the period-end dividend liability and disclose the dividend as a non-adjusting event (IAS 10.12; IAS 1.137).
Official guidance: IFRS issued standards
IAS 10.14-15 require the financial statements not to be prepared on a going concern basis if, after the reporting period, management intends to liquidate or cease trading or has no realistic alternative; a lesser deterioration may still create a material uncertainty to disclose (IAS 1.25). Update forecasts and covenant assessments for the event. The common trap is treating a severe post-period deterioration as a routine non-adjusting disclosure when it actually changes the basis of preparation.
Assess the going concern impact of the event before authorising the financial statements (IAS 10.14-15).
Official guidance: IFRS issued standards
IAS 10.17-19 require disclosure of the date the financial statements were authorised for issue and who gave that authorisation, and events are captured through that date; events arising after authorisation are not reflected unless revised statements are issued (IAS 10.19-20). Confirm the note is complete and dated at authorisation. The common trap is finalising the note before the authorisation date and failing to sweep for events in the intervening period.
The events note is complete and dated at authorisation; the non-adjusting event disclosure is finalised (IAS 10.17; IAS 10.21). Complete and date the events-after-reporting-period note before board authorisation (IAS 10.17).
Official guidance: IFRS issued standards
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