Events occurring or becoming known after the close of the period may have a significant effect on the financial statements and should be disclosed are called:

Question

Quizplus · Accepted Answer

Subsequent events refer to events that occur after the close of the period but before the financial statements are issued or available to be issued. These events may have a significant effect on the financial statements and thus require disclosure. Examples of subsequent events include mergers and acquisitions, natural disasters, and significant litigation settlements. It is the responsibility of the company's management to evaluate subsequent events to determine if they require disclosure in the financial statements.

Events Occurring or Becoming Known After the Close of the Period