• Earn Point Get Rewards

    Get REWARD POINTS on various postings. Hurry!!!

  • Accountants' Adda

    The One stop solutions to all your knowledge thirst Accounting | Finance | Banking | Taxation

  • Post articles, files, newsletters and get exciting prizes!!

Prev      Next

AS 4: Contingencies and Events Occurring after the Balance Sheet Date

  Created By : Vikash Goel   Category: Accounting Standards    on   Jun 21 2012  Last Modified   Jul 4 2012      
Viewed: 6359


Accounting Standard 4: Contingencies and Events Occurring after the Balance Sheet Date

A contingency is a condition or situation the ultimate outcome of which will be known or determined only on the occurrence or non-occurrence of uncertain future event/s.

Events occurring after the balance sheet date are those significant events both favourable and unfavourable that occur between the balance sheet date and the date on which the financial statements are approved.

Amount of a contingent loss should be provided for by a charge in P & L A/c if it is probable that future events will confirm that an asset has been impaired or a liability has been incurred as at the balance sheet date and a reasonable estimate of the amount of the loss can be made.

Existence of contingent loss should be disclosed if above conditions are not met, unless the possibility of loss is remote.

Contingent Gains if any, not to be recognised in the financial statements.

Material change in the position due to subsequent events be accounted or disclosed.

Proposed or declared dividend for the period should be adjusted.

Material event occurring after balance sheet date affecting the going concern assumption and financial position be appropriately dealt with in the accounts.

Contingencies or events occurring after the balance sheet date and the estimate of the financial effect of the same should be disclosed.

Note: The underlined paras/words have been withdrawn on issuance of AS 29 effective for accounting periods commencing on or after 1-4-2004

Tag Name:   Accounting Standards

Share your views:    (2)   (0)   (0)   

0 Comments for this Article

Please Login to post your comment

Latest News

Quick Links