Events occurring after the date of the balance sheet but before the issuance of the financial statements and auditor's report are referred to as:
A) interim events.
B) post- closing events.
C) subsequent events.
D) preaudit events.

Question

Quizplus · Accepted Answer

These events are referred to as subsequent events. They are divided into two categories: (1) recognized subsequent events, where the event provides additional evidence about conditions that existed at the balance sheet date and (2) nonrecognized subsequent events, where the event provides evidence about conditions that did not exist at the balance sheet date. The auditor should evaluate both types of subsequent events to assess their impact on the financial statements and the disclosure required in the financial statements.

Events Occurring After the Date of the Balance Sheet but Before