Page 250 - F1 Integrated Workbook STUDENT 2018

Chapter 14

3.1 Dividends

A dividend will first be proposed by directors, then declared (confirmed) and then
paid. Ordinary dividends should only be accounted for when declared, whereas
preference dividends are always accrued. Equity dividends declared after the
reporting period should not be recognised as a liability at the reporting date but
should be disclosed by note, provided they are declared before the financial
statements are authorised for issue.

3.2 Going concern

If an event after the reporting date indicates that the entity is no longer a going
concern, the financial statements for the current period should not be prepared on
the going concern basis.

3.3 Disclosure

A material event after the end of the reporting period should be disclosed (by note)
where it is a non-adjusting event of such importance that its nondisclosure would
affect the ability of users of financial statements to reach a proper understanding of
the financial position.

3.4 The note should disclose

 The nature of the event.

 An estimate of the financial effect, or a statement that it is not practicable to
make such an estimate. The estimate should be made before taking account of
taxation, with an explanation of the taxation implications where necessary for a
proper understanding of the financial position.

 The date the directors approve financial statements. The date on which the
financial statements are authorised for issue should be disclosed.

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