Subsequent Events

Question 1

What are examples of Non Recognized Subsequent Events? Reported in the Notes

Answer 1

Sale of a bond or capital stock issued after the balance sheet date but before financial statements are issued or are available to be issued

A business combination that occurs after the balance sheet date but before financial statements are issued or are available to be issued ([FASB ASC] 805 requires specific disclosures in such cases.)

Settlement of litigation when the event giving rise to the claim took place after the balance sheet date but before financial statements are issued or are available to be issued

Loss of plant or inventories as a result of fire or natural disaster that occurred after the balance sheet date but before financial statements are issued or are available to be issued

Losses on receivables resulting from conditions (such as a customer’s major casualty) arising after the balance sheet date but before financial statements are issued or are available to be issued

Changes in the fair value of assets or liabilities (financial or nonfinancial) or foreign exchange rates after the balance sheet date but before financial statements are issued or are available to be issued

Entering into significant commitments or contingent liabilities, for example, by issuing significant guarantees after the balance sheet date but before financial statements are issued or are available to be issued.

Question 2

What are some examples of situations Recognized in the Financial Statements?

Answer 2

Loss on an uncollectible trade account receivable as a result of a customer’s deteriorating financial condition leading to bankruptcy after the balance sheet date but before the financial statements are issued or are available to be issued

The events that gave rise to litigation took place before the balance sheet date and that litigation is settled, after the balance sheet date but before the financial statements are issued or are available to be issued, for an amount different from the liability recorded in the accounts.

Shortly before financial statements are issued, the actual loss of plant or inventories as a result of fire or natural disaster that occurred before the balance sheet date is determined to be greater than the loss that was originally estimated.

Question 3

What are Subsequent Events?

Answer 3

events or transactions that occur after the balance sheet date but before financial statements are issued or are available to be issued

Question 4

What is the FASB number for Subsequent Events?

Answer 4

855