A company adopting the replaceable rules included in the Corporations Act announces a dividend to be paid after balance date.The company:
A) must recognise a liability in its financial statements
B) must not recognise a liability
C) has the choice of whether to recognise a liability or not
D) none of the above

Question

Quizplus · Accepted Answer

According to the replaceable rules included in the Corporations Act, a company is not required to recognise a liability for a dividend until it is declared by the company's directors. Therefore, the company must not recognise a liability for the dividend announcement made after balance date.

A Company Adopting the Replaceable Rules Included in the Corporations